Pkrevenue.com

Author: Mrs. Anjum Shahnawaz

  • Engro Corp declares 32% revenue growth

    Engro Corp declares 32% revenue growth

    KARACHI: Engro Corporation has posted consolidated annual revenue growth of 32 percent for the period ended December 31, 2019 as compared with the revenue of the last year.

    The significant growth in revenue mainly driven by energy projects in Thar coming online during July 2019 and augmented by higher turnover of Fertilizers and Petrochemicals businesses, a statement said on Friday.

    The Company posted a consolidated profit after tax (PAT) of Rs30.288 billion compared to Rs23.632 billion for last year. Profit attributable to the owners was recorded at Rs16.533 billion compared to Rs12.708 billion for last year.

    This growth in profitability is after accounting for a provision of Rs1.224 billion relating to impairment of the Company’s investment in FrieslandCampina Engro Pakistan Limited, under the requirements of International Accounting Standard 36 (Impairment of Assets).

    On a standalone basis, the Company posted a PAT of Rs14.303 billion against Rs12.720 billion for the comparative year, translating into earnings per share of Rs24.83 per share. This increase is primarily attributed to higher dividends from subsidiaries as well as higher interest income on investable reserves.

    The company announced a final cash dividend of Re1.00 per share for the fourth quarter, bringing the cumulative payout for the year to Rs24.00 per share.

    Fertilizer business achieved a historic milestone of highest ever Urea production of 2 million tons due to better plant efficiency and higher gas availability.

    This, coupled with higher fertilizer prices, has resulted in an increase of 11 percent in sales revenue over the prior year.

    The business recorded a PAT of Rs16.871 billion – down by 3 percent from last year – decrease mainly attributed to a one-off deferred tax impact of higher future corporate tax rates introduced through Finance Act, 2019.

    Urea prices are expected to remain under pressure following a prospective reduction in GIDC. In response to this reduction, the business passed on the benefit to the end consumer through a price reduction of Rs160/bag.

    Furthermore, the fertilizer industry continues to face challenges in the recovery of long outstanding subsidy and retrospective settlement of GIDC.

    Polymer business recorded a revenue growth of 7 percent, while PAT was Rs3.661 billion compared to Rs4.930 billion for last year.

    This fall in profits is attributable to inflationary impacts in the form of higher energy prices and interest rates coupled with one-off gains recorded in 2018.

    In line with its long-term strategy, the business successfully initiated commercial production and commenced exports from its Caustic Flake plant.

    Development of the 3.8 Mt per annum mine at Thar concluded with the successful ‘Test on Completion’ on June 3, 2019. Thereafter, Commercial Operations Date (COD) was declared on July 10, 2019 for both mining and power projects and the Thar power plant has been running smoothly ever since.

    Further, the project commenced construction of Phase II of the mine expansion and achieved Financial Close on December 31, 2019, which will enhance production of coal from the mine to 7.6 Mt per annum.

  • FBR considers transfer back customs officials

    FBR considers transfer back customs officials

    The Federal Board of Revenue (FBR) is actively reviewing requests for the transfer back of Pakistan Customs officials who were posted to outstations in 2019. This move comes in response to a significant number of appeals submitted by affected officials over the years.

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  • FATF maintains Pakistan’s grey list status till June 2020

    FATF maintains Pakistan’s grey list status till June 2020

    KARACHI: Financial Action Task Force (FATF) on Friday maintained Pakistan’s status of grey list till June 2020 and asked the country to complete its full action plan.

    “To date, Pakistan has largely addressed 14 of 27 action items, with varying levels of progress made on the rest of the action plan. The FATF strongly urges Pakistan to swiftly complete its full action plan by June 2020,” a statement received from Paris, France after conclusion of FATF plenary meeting (February 19-21, 2020).

    The statement said:

    “Since June 2018, when Pakistan made a high-level political commitment to work with the FATF and APG to strengthen its AML/CFT regime and to address its strategic counter-terrorist financing-related deficiencies, Pakistan’s political commitment has led to progress in a number of areas in its action plan, including risk-based supervision and pursuing domestic and international cooperation to identify cash couriers. Pakistan should continue to work on implementing its action plan to address its strategic deficiencies, including by:

    (1) demonstrating that remedial actions and sanctions are applied in cases of AML/CFT violations, relating to TF risk management and TFS obligations;

    (2) demonstrating that competent authorities are cooperating and taking action to identify and take enforcement action against illegal money or value transfer services (MVTS);

    (3) demonstrating the implementation of cross-border currency and BNI controls at all ports of entry, including applying effective, proportionate and dissuasive sanctions;

    (4) demonstrating that law enforcement agencies (LEAs) are identifying and investigating the widest range of TF activity and that TF investigations and prosecutions target designated persons and entities, and those acting on behalf or at the direction of the designated persons or entities;

    (5) demonstrating that TF prosecutions result in effective, proportionate and dissuasive sanctions

    (6) demonstrating effective implementation of targeted financial sanctions (supported by a comprehensive legal obligation) against all 1267 and 1373 designated terrorists and those acting for or on their behalf, including preventing the raising and moving of funds, identifying and freezing assets (movable and immovable), and prohibiting access to funds and financial services;

    (7) demonstrating enforcement against TFS violations including administrative and criminal penalties and provincial and federal authorities cooperating on enforcement cases;

    (8) demonstrating that facilities and services owned or controlled by designated person are deprived of their resources and the usage of the resources.

    “All deadlines in the action plan have expired. While noting recent and notable improvements, the FATF again expresses concerns given Pakistan’s failure to complete its action plan in line with the agreed timelines and in light of the TF risks emanating from the jurisdiction.

    The statement said that in case the country failed to comply the FATF will take action, which could include the FATF calling on its members and urging all jurisdiction to advise their FIs to give special attention to business relations and transactions with Pakistan.

  • FBR chairperson to inaugurate International Tax Operations directorate on Feb 22

    FBR chairperson to inaugurate International Tax Operations directorate on Feb 22

    KARACHI: Ms. Nausheen Amjad, Chairperson, Federal Board of Revenue (FBR) will inaugurate directorate of international tax operations in Karachi on Saturday February 22, 2020.

    Member Inland Revenue (IR) and Director General Offshore Taxation will also accompany the FBR chairperson.

    Office of the Directorate of International Tax Operation Karachi (Sindh) located at PNSC building.

    The directorate of international tax operations has mandate to receive and send information from other jurisdictions under spontaneous, automatic and on demand exchange of information under exchange of information agreements.

    The directorate has been authorized to levy and recover tax by passing an assessment order under section I23 (1A) of Income Tax Ordinance, 2001 in case of undeclared off-shore assets and incomes.

    It has also been authorized to receive, transmit and exchange country reports to the jurisdictions that are parties to international by country agreements with Pakistan.

    Further the FBR has empowered the directorate to conduct transfer pricing audit in cases selected for such audit.

  • Stock market falls by 232 points on selling pressure

    Stock market falls by 232 points on selling pressure

    KARACHI: The stock market fell by 232 points on Friday owing to selling pressures during the trading sessions.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 40,249 points as against 40,482 points showing a decline of 232 points.

    Analysts at Arif Habib Limited said that the market faced selling pressure and saw a drawdown of 311 points during the session, closing -232 points.

    Market kept waiting for the official version of FATF plenary session till the close but merely got positive hints rather than an official statement.

    E&P, Refineries, OMCs, Steel and Fertilizer bore selling pressure. MUGHAL announced financial results, which showed significant tax reversal that caused Investors to stay cautious and sell the stock, which brought stock price down in the closing half hour.

    Trading activity in banking sector stocks remained muted. Cement Sector led the volumes with 19.6 million shares, followed by Food (9.8 million) and Power (9.1 million). Among scrips, MLCF topped the volumes with 8.1 million shares, followed by KAPCO (7.5M) and FFL (5.9 million).

    Sectors contributing to the performance include Fertilizer (-92 points), Banks (-64 points), E&P (-49 points), Inv Banks (-35 points), Power (+24 points) and Cement (+21 points).

    Volumes slipped further from 112.1 million shares to 85.6 million shares (-24 percent DoD). Average traded value also declined by 24 percent to reach US$ 23.2 million as against US$ 30.6 million.

    Stocks that contributed significantly to the volumes include MLCF, KAPCO, FFL, UNITY and DGKC, which formed 36 percent of total volumes.

    Stocks that contributed positively include HUBC (+24 points), LUCK (+18 points), SHFA (+8 points), HMB (+7 points) and PMPK (+6 points). Stocks that contributed negatively include ENGRO (-66 points), MCB (-44 points), DAWH (-34 points), OGDC (-31 points), and HBL (-24 points).

  • Rupee appreciates by three paisas against dollar

    Rupee appreciates by three paisas against dollar

    KARACHI: The Pakistani Rupee appreciated modestly against the US dollar on Friday, gaining three paisas to close at Rs154.20 in the interbank foreign exchange market.

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  • Bearer Prize Bonds of Rs40,000 not to be encashed after March 31

    Bearer Prize Bonds of Rs40,000 not to be encashed after March 31

    KARACHI: State Bank of Pakistan (SBP) has said that people can encashed Rs40,000 bearer prize bonds on or before March 31, 2020 and after that the financial instruments cannot be redeemed.

    The central bank issued frequently asked questions (FAQs) related to the withdrawal of Rs. 40,000/- National Prize Bonds (Bearer) from Circulation to facilitate general public and investors.

    Q: Have National Prize Bonds (Bearer) of Rs.40,000/- denomination been withdrawn from circulation?

    A: Yes. The Finance Division (Budget Wing), Government of Pakistan vide Notification No. F.16(3)GSI/2014-1072 dated June 24, 2019 has restricted the sale of National Prize Bonds (Bearer) of Rs.40,000/-denomination after June 24, 2019.

    Q: Is there a time limit for conversion/encashment of my National Prize Bonds (Bearer) of Rs.40,000/- denomination?

    A: Yes. As per aforementioned Notification from the Government of Pakistan, National Prize Bonds (Bearer) of Rs. 40,000/- denomination can be encashed/redeemed upto March 31, 2020, after which they would not be encashed / redeemed.

    Q: How can I encash/redeem my National Prize Bonds (Bearer) of Rs.40,000/- denomination?

    A: The National Prize Bonds (Bearer) of Rs.40,000/- denomination can be encashed using the following options:

    1. Conversion to Premium Prize Bonds (Registered)

    2. Replacement with Special Savings Certificate (SSC) / Defence Savings Certificate (DSC)

    3. Encashment through Bank Account

    Q: How can I convert my National Prize Bonds (Bearer) of Rs.40,000/- denomination to Premium Prize Bonds (Registered)?

    A: The National Prize Bonds (Bearer) of Rs.40,000/- denomination can be converted to Premium Prize Bonds (Registered) through the 16 field offices of SBP Banking Services Corporation, and six commercial banks i.e. National Bank of Pakistan, Habib Bank Limited, United Bank Limited, MCB Bank Limited, Allied Bank Limited and Bank Alfalah Limited. The documentary requirements for the purchase of Premium Prize Bonds (Registered) are available at: http://www.sbp.org.pk/sbp_bsc/PrizeBond/premium/FAQs.pdf

    Q: How can I replace my National Prize Bonds (Bearer) of Rs.40,000/- denomination with Special Savings Certificates (SSC) / Defence Saving Certificates (DSC)?

    A: The National Prize Bonds (Bearer) of Rs.40,000/- denomination can be replaced with SSC / DSC through the 16 field offices of SBP Banking Services Corporation, Authorized Commercial banks and National Savings Centers.

    Q: How can I encash my National Prize Bonds (Bearer) of Rs.40,000/- denomination through bank account?

    A: On submission of request on the prescribed application form (details at Q7 below) at 16 field offices of SBP Banking Services Corporation or Commercial Banks, the proceeds of encashment shall be credited to the bond-holder’s bank account.

    Q: What information/documents are required to convert/redeem/encash my National Prize Bonds (Bearer) of Rs.40,000/- denomination?

    A: Request for conversion/encashment of Rs.40,000/- National Prize Bonds (Bearer) shall be submitted on prescribed application form which is available at the following weblink:

    http://www.sbp.org.pk/sbp_bsc/BSC/CMD/Circulars/2019/C1-Annex-A-Application-Form.pdf.

    The requisite information/documents required for each encashment option is as follows:

    1. Conversion to Premium Prize Bonds (Registered): Legible copy of valid CNIC / SNIC, Account

    Maintenance Certificate (not older than one month from application date), Valid IBAN number

    2. Replacement with Special Savings Certificate (SSC) / Defence Savings Certificate (DSC): Legible Withdrawal of Rs. 40,000/- National Prize Bonds (Bearer) from Circulation copy of valid CNIC / SNIC

    3. Encashment through Bank Account: Valid IBAN number

    Q: Can I receive cash against my National Prize Bonds (Bearer) of Rs.40,000/- denomination?

    A: No. The National Prize Bonds (Bearer) of Rs.40,000/- denomination can only be encashed using the following options:

    1. Conversion to Premium Prize Bonds (Registered)

    2. Replacement with Special Savings Certificate (SSC) / Defence Savings Certificate (DSC)

    3. Encashment through Bank Account

    Q: Is there any tax / deduction against the conversion/encashment of National Prize Bonds (Bearer) of Rs.40,000/- denomination ?

    A: No. There is no tax / deduction for any of the approved conversion/encashment options.

    Q: For encashment of National Prize Bonds (Bearer) of Rs.40,000/- denomination through bank account, can I visit any Commercial Bank, or do I have to visit the Commercial Bank in which my account is maintained ?

    A: The National Prize Bonds (Bearer) of Rs.40,000/- denomination bonds can be encashed at any branch of the Commercial Bank in which bondholder maintains an “individual” account.

    Q: What is the timeline for credit of Face Value into my bank account?

    A: The Face Value shall be credited to the bank account on the same day, subject to provision of required information.

    Q: National Prize Bonds (Bearer) of Rs.40,000/- denomination are being encashed against cash at a discount rate. Is it allowed?

    A: As per Rule 3(2) of Prize Bonds Rules 1999, only Offices of the State Bank of Pakistan Banking Services Corporation, Commercial Banks authorized in this behalf by SBP, and National Savings Centers are authorized to carry out business of National Prize Bonds (Bearer). Further, the Rule 3(3) of the said Rules restricts any other office, body or institution other than the office, body or institutions specified in Rule 3(2) of Prize Bonds Rules, 1999 from conducting any business relating to National Prize Bonds (Bearer).

    The SBP said that the bondholders receive full amount (without any deduction) for any of the approved conversion/encashment options.

    Q: Will there be any further prize money draws for National Prize Bonds (Bearer) of Rs.40,000/- denomination?

    A: No. The last draw (78th draw) for Rs.40,000/- denomination National Prize Bonds (Bearer) was conducted on June 3, 2019. As per the Notification from Finance Division (Budget Wing) Government of Pakistan, no further prize money draws shall be conducted for National Prize Bonds (Bearer) of Rs.40,000/- denomination.

    Q: I have a prize-winning National Prize Bond (Bearer) of Rs.40,000/- denomination. What is the time limit for claiming my prize ?

    A: Under the governing rules, the prize money may be claimed by the holder of the prize bond at any time within a period of six years from the date of draw.

    Q: Can I encash damaged National Prize Bond (Bearer) of Rs.40,000/- denomination?

    A: Yes. Damaged National Prize Bonds (Bearer) of Rs.40,000/- denomination can be encashed at the 16 field offices of SBP Banking Services Corporation. However, it is pertinent to note that all such claims shall Withdrawal of Rs. 40,000/- National Prize Bonds (Bearer) from Circulation be decided by the authorized officials in light of relevant regulations.

  • Audit cases should be assigned to tax officials on basis of skills

    Audit cases should be assigned to tax officials on basis of skills

    KARACHI: Tax managers have suggested that audit cases should be assigned to tax officials on the basis of skills and experience.

    “Cases should be assigned on the basis of skill and experience of the officers as it reduces no change monitoring and enhance productivity,” according to an official document on monitoring of withholding taxes.

    If a pre-monitoring analysis is conducted by the officers, they will be in a position to ascertain the true potential of specific cases, sectors and their overall impact on the revenue generating activities of the department.

    For this purpose, they should examine:

    — nature and extent of business entities;

    — past compliance behaviour, tax fraud activities;

    — group activities as to compliance of tax laws;

    — results of previous monitoring and tax audits by the Income Tax and the Sales Tax departments;

    — overall declarations and amended Returns, etc, penalties, refunds and corporate status can give a good guidance for selection or otherwise of a case for detailed monitoring of withholding taxes;

    — Past information about surveys and special/sectoral studies can also be helpful;

    — Taxpayer’s complete particulars are important for follow-up;

    For the sake of transparency, it is always good for the tax department to state the following;

    — Scope of the monitoring process;

    — Process to be followed by the departmental officers for monitoring of a specific case;

    — The taxpayers should be informed as to how they will be contacted;

    — How the case is to be discussed and who will represent the department;

    — How the record will be examined;

    — How to convey the findings of the examination/discussions on the cases to the taxpayers;

    — Mechanism for submitting replies by the taxpayers;

    — Writing the reports about monitoring; and

    — To determine future course of action under the relevant provisions of law in the light of the findings of the report, wherever requiring further action.

  • Regulatory duty on wheat import withdrawn; SRO issued

    Regulatory duty on wheat import withdrawn; SRO issued

    ISLAMABAD: Federal Board of Revenue (FBR) on Thursday issued notification to withdraw regulatory duty on import of wheat and other wheat products.

    The Revenue Division issued SRO 119(I)/2020 dated February 19, 2020 to amend SRO 680(I)/2019 to withdraw regulatory duty on import of wheat.

    The government imposed 60 percent regulatory duty on import of wheat, which has been withdrawn through the latest SRO.

  • Foreign exchange reserves up by $12 million

    Foreign exchange reserves up by $12 million

    KARACHI: The liquid foreign exchange reserves of the country increased by $12 million to $18.747 billion by week ended February 14, 2020, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves were at $18.735 billion by week ended February 7, 2020.

    The official foreign exchange reserves of the SBP increased by $74 million to $12.505 billion by week ended February 14, 2020 as against $12.431 billion a week ago.

    The foreign exchange reserves held by commercial banks however fell by $62 million to $6.242 billion by week ended February 14, 2020 as against $6.304 billion a week ago.