Pkrevenue.com

Author: Mrs. Anjum Shahnawaz

  • Rupee depreciates six paisas against dollar

    Rupee depreciates six paisas against dollar

    KARACHI: The Pak Rupee fell six paisas against dollar on Tuesday owing to demand for import and corporate payments, dealers said.

    The rupee ended Rs155.01 to the dollar as compared with Rs154.95 in interbank foreign exchange market.

    The dealers said that the rupee was depreciated due to rising demand of dollar for import and corporate payments.

    They said that the corporate buyers escalated the demand because of repatriation of profit for the quarter ended December 31, 2019.

    The foreign currency market was initiated in the range of Rs155.00 and Rs155.07. The market recorded day high of Rs155.09 and low of R155.00 and closed at Rs155.01.

    The exchange rate in open market witnessed stable value of the local currency. The buying and selling of the dollar was recorded at Rs155.00/Rs155.30, the same previous day’s closing, in cash ready market.

  • FBR chairman on 14 days leave

    FBR chairman on 14 days leave

    The Chairman of the Federal Board of Revenue (FBR), Syed Muhammad Shabbar Zaidi, is set to take a 14-day leave, according to an official notification issued on Tuesday. The leave is effective from January 6, 2020, to January 19, 2020.

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  • FBR to launch simplified tax return form for small traders

    FBR to launch simplified tax return form for small traders

    ISLAMABAD: Federal Board of Revenue (FBR) is set to launch simplified income tax return form for small retailers, sources said on Tuesday.

    “The FBR is likely to issue the return form for small return forms in pursuance to the agreement between the tax authorities and traders associations signed on October 30, 2019,” a senior tax official said.

    The official said that the FBR had finalized all the formalities to facilitate the small traders as envisaged in the agreement.

    The FBR has already extended the last date for filing income tax returns for tax year 2019 up to January 31, 2020.

    Certain relaxation to traders have already been announced through Tax Laws (Second Amendment) Ordinance, 2019.

    The term “trader” has been defined to mean an individual engaged in business of buying and selling of goods in the same state, including a retailer and a wholesaler but excluding a distributor.

    According to PwC A F Ferguson Chartered Accountants the concessions provided to traders are as under:

    (i)The general rate of minimum tax payable (under section 113 of the ITO 2001) has been reduced from 1.5 percent to 0.5 percent for tax year 2020 for traders having turnover up to Rs. 100 million. However, for traders who have filed income tax returns for tax year 2018, the tax liability for tax years 2019 and 2020 should not be less than the tax liability for tax year 2018, to become eligible for reduced rate of Minimum Tax of 0.5 percent.

    (ii)Individual having turnover of Rs. 50 million or more in any of the preceding tax years is liable to deduct tax under section 153 while making payments against supply of goods, services and contracts.

    Through the Second Amendment Ordinance, traders being individuals having turnover upto Rs. 100 million have been exempted from deducting tax under section 153 while making payment against supply of goods, services and contracts. The Board is expected to clarify the year with respect to which turnover of Rs100 million will be calculated by the trader.

  • Investigation launched against 88 housing schemes

    Investigation launched against 88 housing schemes

    ISLAMABAD: Competition Commission of Pakistan (CCP) has initiated investigation against around 88 housing schemes for deceptive marketing practices.

    In a statement on Monday, the CCP said that it had launched the enquiry while taking notice of the widespread concerns and complaints regarding the prima facie deceptive market practices by various housing schemes in Punjab.

    The CCP said that the Lahore Development Authority (LDA) informed through a letter that 88 housing schemes in Lahore and its adjacent district of Kasur, Sheikhupura and Nankana Sahib were luring investors and the general public through print and TV advertisements to invest in their schemes, without meeting the legal requirements and in violation of the pertinent laws.

    The LDA has sought a ban on the advertising campaign of these schemes to save the citizens from financial losses.

    The CCP took suo moto notices and authorized an enquiry team to thoroughly probe the housing schemes and submit the report to the Commission.

    As part of the investigation the team had visited 62 housing schemes to see the situation on ground and was scheduled to visit the remaining housing schemes.

    The team also met the Director General LDA and other concerned officials to enlighten itself about the pertinent issues and explore the ways to cooperate and coordinate in the areas of shared interests.

    The CCP said that Section 10 of the Competition Act prohibits businesses from indulging in deceptive market practices, which also include the distribution of false or misleading information lacking reasonable basis, deceiving the consumers, and harming the business interest of the other undertakings.

    If the violation of Section 10 is proved against the housing schemes, the CCP may issue show cause notices to them, according to the statement.

    The CCP is mandated under the Competition Act to ensure free competition in all spheres of commercial and economic activity, to enhance economic efficiency and to protect consumers from anti-competitive behavior including deceptive market practices.

  • Auction of confiscated motor vehicles to be held on Jan 09

    Auction of confiscated motor vehicles to be held on Jan 09

    KARACHI: Pakistan Customs has announced an auction of confiscated motor vehicles, set to take place at the Anti-Smuggling Organization (ASO) on January 09, 2019.

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  • Higher inflation jacks FBR’s revenue collection up: SBP

    Higher inflation jacks FBR’s revenue collection up: SBP

    KARACHI: Higher inflation has jacked up the revenue collection for Federal Board of Revenue (FBR) besides other factors including increase in tax rates and reinstatement of tax on telecom services, State Bank of Pakistan (SBP) said on Monday.

    The SBP in its quarterly report on state of economy for July – September 2019/2020 said that the overall FBR taxes grew 15.2 percent in first quarter of 2019/2020, compared to the 8.8 percent rise noted in the same quarter of the last fiscal year.

    This higher growth can be attributed to: (i) an increase in sales tax rates; (ii) reinstatement of taxes on telecom services; (iii) an upward revision of tax rates on various salary slabs; (iv) increase in interest rates and higher tax on profit on debt;3 (v) upward revision in the federal excise duty (FED) rates; and (vi) the abolishment of the zero rating regime on five export-oriented sectors.

    “In addition to these measures, the impact of higher inflation also boosted revenue mobilization.”

    For 2019/2020, the SBP’s projections at the start of the year (July 2019) clocked in at an elevated range of 11-12 percent. Not only was this range higher than previously projected, but it was also in excess of the medium-term target of 5-7 percent.

    Despite this improvement, the FBR managed to achieve only 17.3 percent of the annual target of Rs 5,555.0 billion for 2019/2020. “This means that tax revenues would require a substantially higher growth in the remaining 9 months of the year to achieve the full year target.”

    Moreover, import-related taxes, representing nearly half of FBR taxes, would remain under stress due to the ongoing declining trend in imports. Dutiable imports, in particular, declined sharply in the first quarter of 2019/2020.

    Encouragingly, the fiscal authorities have introduced some initiatives to facilitate business and individual tax payers and to broaden the tax base.

    For instance, in order to provide hassle-free refunds to exporters, the FBR has introduced the Fully Automated Sales Tax e-Refund (FASTER) system for tackling refund claims within 72 hours.

    The FBR has also launched a mobile application, “FBR Tax Asaan,” to facilitate taxpayers in paying sales tax and claiming refunds.

    In addition, video tutorials are prepared and uploaded online to guide taxpayers in filing their income tax returns.

    These efforts to simplify and streamline the taxation mechanism have also contributed to the improvement in Pakistan’s ranking in the World Bank’s Ease of Doing Business: the digitization of tax collecting procedures was cited as one of the drivers of the improvement in the country’s ranking. In addition, the government has continued its drive to increase documentation in the economy.

    However, businesses are resisting some of these documentation measures, such as the CNIC condition on business-to-business (B2B) and business-to-consumer (B2C) transactions.

  • Birds hit two PIA aircraft

    Birds hit two PIA aircraft

    KARACHI: At least two aircraft of Pakistan International Airlines (PIA) were damaged in bird-strike incidents which were took place at Karachi Airport, a spokesman said on Monday.

    “Today two aircraft were hit by birds once again. Both incidents took place at the Karachi airport,” PIA spokesman Abdullah Khan said.

    The spokesman said that flight number PK301 was damaged on the nose and other flight number PK311 on its wing flap by the bird strike.

    “These strikes not only pose life threatening danger for passengers but also cause financial losses,” the spokesman added.

    The national flag carrier appealed several times for appropriate actions to be taken to remove presence of birds around the airport.

    The spokesperson said that the PIA had contacted Civil Aviation Authority (CAA) in this regard, along with running a special social media campaign to raise awareness on the issue.

    “Unfortunately, no substantial action has so far been taken,” the spokesperson said and urged everyone to join the airline in addressing the issue as it concerns everyone.

  • Import bill plunges by 17.06% in first half

    Import bill plunges by 17.06% in first half

    KARACHI: Pakistan’s import bill fell by 17.06 percent during first six months (July – December) 2019/2010 owing to deceleration in international commodity prices and lower domestic demand.

    According to data released by the ministry of commerce, the import bill reduced to $23.18 billion during first half of current fiscal year as compared with $27.94 billion in the corresponding half of the last fiscal year.

    The exports exhibited 3.21 percent growth during the period under review owing to better earning of local manufacturers in the international markets.

    The total exports were at $11.54 billion during July – December 2019/2020 as compared with $11.18 billion in the corresponding period of the last fiscal year.

    The lower import bill brought down the trade deficit by 30.58 percent for the period under review.

    The trade deficit declined to $11.64 billion during July-December 2019/2020 as compared with the deficit of $16.77 billion in the corresponding period of the last fiscal year.

    According to trade data for the period July – December 2019/2020 revealed that the import of motor cars in completely build unit (CBU) fell by 80 percent to $31 million as compared with $156 million.

    While import of CKD (Completely Knocked Down) motor cars fell by 46 percent to $229 million in first six months of current fiscal year as compared with $426 million in the same period of the last fiscal year.

    The import of petroleum crude declined by 30 percent to $1.7 billion during first six months of current fiscal year as compared with $2.42 billion in the corresponding months of the last fiscal year.

    While import of petroleum products fell by 24 percent to $2.59 billion during July – December 2019/2020 when compared with $3.41 billion in the same period of the last fiscal year.

    According to top performing export items, basmati rice posted 56 percent increased to $380.2 million during first six months of current fiscal year when compared with $244 million in the corresponding period of the last fiscal year.

    Export of meat posted 52 percent growth to $155.9 million during July – December 2019/2020 when compared with $103 million in the corresponding period of the last fiscal year.

    The exports of readymade garments registered increase of 12 percent to $1.41 billion during first half of current fiscal year as compared with $1.26 billion in the same half of the last fiscal year.

  • KTBA seeks FBR clarification on tax ordinance

    KTBA seeks FBR clarification on tax ordinance

    KARACHI: Karachi Tax Bar Association (KTBA) on Monday urged Federal Board of Revenue (FBR) to issue necessary clarification related to issues in recently promulgated tax ordinance.

    The KTBA sent a letter to Syed Shabbar Zaidi, Chairman, FBR and pointed out anomalies in the Tax Laws (Second Amendment) Ordinance, 2019 for clarification.

    The KTBA highlighted that Sub-section 4 has been added to section 73 of Sales Tax Act, 1990, under which sales to an unregistered person by a registered manufacture cannot be made for more than Rs10 million in a month and Rs100 million in a year, failing which input tax will be disallowed proportionately.

    Considering the implication of the phrase of unregistered person [i.e. singular term] used in drafting of the law, instead of the phrase unregistered persons [plural term], it implies that the restriction is applicable on sales to a single unregistered person instead of cumulative sales to all unregistered person(s).

    In order to ensure that intent of law is not suffered by any legal infirmity due to any unintended or inadvertent drafting, the clarification must be issued in this respect on urgent note, it added.

    It further pointed out that in addition to the above, it should also be clarified as to whether the all unregistered person will be effected or only those unregistered person who actually were required to be registered in Sale Tax but didn’t ?

    In the event, the law is intended to cover all unregistered persons, without any discrimination, certain serious ramification would follow because of the fact that Manufacturers won’t be able to make sale to various Government/other authorities, armed forces hospitals, Universities, Charities & EPZ entities, which by law, are not required to be registered at all, in the first place.

    The KTBA said that it is important to define the category of unregistered person who should not suffer due to any adverse implication of the law. Hence, a clarification is necessitated in this context.

    The tax bar further highlighted the amendments introduced related to business license.
    Through the Tax Laws (Second Amendment) Ordinance, 2019, various penalties have been prescribed for person who has not obtained business license, while the procedure to obtain business license has not been prescribed as yet.

    It is not possible to get a Business License either for any person or for any tax commissioner to issue one.

    An unnumbered and undated draft SRO was issued by the FBR in July 2019, whereby Draft rules 83A to 83E were proposed in the Income Tax Rules, 2002 for the purpose, which were not finalized yet.