Pkrevenue.com

Author: Mrs. Anjum Shahnawaz

  • Import of used vehicles: changes to payment of duty, taxes approved

    Import of used vehicles: changes to payment of duty, taxes approved

    ISLAMABAD: The government has approved changes to payment of duty and taxes system for clearance of used vehicles, which are allowed to import under three different schemes.

    The Economic Coordination Committee (ECC) of the Cabinet on Wednesday on a proposal by the Commerce Division, took up the import of used vehicles under personal baggage, transfer of residence and gift schemes which require the payment of duties and taxes to be paid out of foreign exchange arranged by Pakistani nationals themselves or local recipients producing proof of conversion of foreign remittance to local currency, and allowed the importers to meet any shortfall in arrangement of required foreign remittance for payment of duties and taxes through local sources in case of a scenario where the Pak rupee depreciates or government increases the import duties and/or taxes after the receipt of remittance and before the filing of the good declaration, which results in shortfall of remitted amount vis-a-vis payable duties and taxes.

    The ECC decision would help clear up a total of 1017 vehicles currently stuck at Karachi port because either no foreign remittance had been received or the remitted amount had been rendered insufficient due to depreciation of PKR before the filing or goods declaration or increase in the rate of duty in the Finance Act 2019.

    On another proposal by the Commerce Division, the ECC accorded ex-post approval to an SRO issued by Commerce Division on August 21, 2019 for extending till August 31, 2019 the implementation of quality standards on the import of solar PV equipment into Pakistan under an SRO issued by the Commerce Division on May 28, 2019.

    The Commerce Division had issued the SRO in late August following instructions from the Prime Minister to resolve the issue of several containers stuck up at ports due to lack of clarity amongst stakeholders, pre-shipment companies and border agencies regarding documents required for observance and implementation of the quality standards introduced on May 28, 2019 as per a decision of the federal cabinet.

  • SECP introduces concept of trading only brokers for expanding investor base

    SECP introduces concept of trading only brokers for expanding investor base

    ISLAMABAD: Securities and Exchange Commission of Pakistan (SECP) has introduced a concept of trading only brokers for expanding investor base at the capital market.

    In the proposed regime, to provide maximum facilitation to small sized brokers, which would be categorized as trading only brokers and shall not retain custody of client assets, the minimum capital requirements for a brokerage license are being reduced to Rs15 million, said a statement issued by the SECP on Wednesday.

    Further, such brokers shall have the flexibility to have a satisfactory QCR rating auditor. These brokerage houses would be allowed to carry out transactions in all markets, including derivatives and leveraged products, with no restriction on number of branches, the SECP said.

    It said that the SECP had undertaken a reform agenda to revitalize the capital market and promote expansion of investor base. It is felt that small and medium sized brokerage houses, alongside large ones, have a critical role to play in this regard.

    Based on representations received from various stakeholders including small sized brokers and recommendations of the Stock Market Reform Committee, the SECP issued a concept paper to introduce categorization of brokers for addressing the issue of custody of client assets.

    This concept is in line with international best practices and tailored to local market requirements, it added.

    The SECP said that under the proposed concept the small sized brokers would be allowed to provide securities and futures advisory services by charging a fee and sell/distribute financial products and also act as consultants to the issue.

    Several compliance requirements relating to client asset segregation, clearing membership, depository participants etc. shall not be applicable on trading only brokers and they would also not be subject to multiple audits/inspections during a year.

    For promoting ease of doing business for small sized brokerage houses, the SECP had earlier removed the requirement to provide separate net capital balance certificates which is now required to be made part of audited accounts of brokers. Requirement for auditors to provide limited assurance report of brokers has also been abolished.

    Furthermore, two additional categories i.e. trading and clearing broker and trading and self clearing broker have been proposed which shall be subject to enhanced net worth, corporate governance, compliance and rating requirements as they would be retaining custody of clients assets.

  • Headline inflation increases by 11 percent in October

    Headline inflation increases by 11 percent in October

    ISLAMABAD: The headline inflation based on Consumer Price Index (CPI) has increased by 11 percent in October 2019 while calculating on the base year 2015-2016.

    According to inflation data released by Pakistan Bureau of Statistics (PBS) on Wednesday, the inflation general increased by 11.0 percent on year-on-year basis in October 2019 as compared to an increase of 11.4 percent in the previous month and 6.5 percent in October 2018.

    On month-on-month basis, it increased by 1.8 percent in October 2019 as compared to an increase of 0.8 percent in the previous month and 2.1 percent in October 2018, the PBS said.

    CPI inflation Urban, increased by 10.9 percent on year-on-year basis in October 2019 as compared to an increase of 11.6 percent in the previous month and 7.0 percent in October 2018.

    On month-on-month basis, it increased by 1.6 percent in October 2019 as compared to an increase of 0.7 percent in the previous month and an increase of 2.2 percent in October 2018.

    CPI inflation Rural, increased by 11.3 percent on year-on-year basis in October 2019 as compared to an increase of 11.1 percent in the previous month and 5.7 percent in October 2018.

    On month-on-month basis, it increased by 2.2 percent in October 2019 as compared to an increase of 0.8 percent in the previous month and an increase of 2.0 percent in October 2018.

    Sensitive Price Indicator (SPI) inflation on YoY increased by 15.1 percent in October 2019 as compared to an increase of 14.7 percent a month earlier and an increase of 1.7 percent in October 2018.

    On MoM basis, it increased by 2.7 percent in October 2019 as compared to an increase of 1.9 percent a month earlier and an increase of 2.3 percent in October 2018.

    Wholesale Price Index (WPI) inflation on YoY basis increased by 13.2 percent in October 2019 as compared to an increase of 15.9 percent a month earlier and an increase of 18.6 percent in October 2018.

    WPI inflation on MoM basis increased by 2.0 percent in October 2019 as compared to an increase of 0.1 percent a month earlier and an increase of 4.4 percent in corresponding month of last year i.e. October 2018.

  • Stock market gains 295 points in mixed trading activities

    Stock market gains 295 points in mixed trading activities

    KARACHI: The stock market gained 295 points on Wednesday in mixed trading activities.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 35,653 points as against 35,358 points showing an increase of +295 points.

    Analysts at Arif Habib Limited said that the market showed early signs of resistance today, where the index increased by 627 points during the session, but selling pressure brought the net gain to +295 points in the end.

    Buying activity was evident across the board, on the back of reduction in NSS rates.

    That gave confidence to investors for further accumulation, despite index already registering a significant surge.

    Overall trading volumes registered close to 300 million – mark, an inch below yesterday’s levels. Cement sector led the volumes with 45.1 million shares, followed by Chemical (29.5 million) and Technology (28 million).

    Among scrips, WTL again led the volumes with 15.8 million shares, followed by FCCL (15.7 million) and KEL (14.7 million).

    Sectors contributing to the performance include Cement (+53 points), Inv Banks (+45 points), Fertilizer (+25 points), Food (+24 points) and Tobacco (+23 points).

    Volumes declined from 297.6 million as against 308.5 million (-4 percent DoD). Average traded value, on the contrary, increased by 21 percent to reach US$ 67.6 million as against 55.8 million.

    Stocks that contributed significantly to the volumes include WTL, FCCL, KEL, UNITY and PAEL, which formed 25 percent of total volumes.

    Stocks that contributed positively include DAWH (+42 points), PAKT (+31 points), PPL (+22 points), LUCK (+20 points) and EFERT (+16 points). Stocks that contributed negatively include OGDC (-14 points), POL (-10 points), PMPK (-7 points), FFC (-7 points), and COLG (-6 points).

  • Rupee gains six paisas on inflows

    Rupee gains six paisas on inflows

    KARACHI: The Pak Rupee gained six paisas against dollar on Wednesday owing to inflows of workers’ remittances and exports receipts, dealers said.

    The rupee ended Rs155.59 to the dollar from previous day’s closing of Rs155.64 in interbank foreign exchange market.

    Currency experts said that the local unit gained values on back of remittances and export receipts. They said that the demand for import and corporate payments was remained lackluster.

    The foreign currency market was initiated in the range of Rs155.63 and Rs155.65. The market recorded day high of Rs155.65 and low of Rs155.59.

    The exchange rate in open market witnessed no change in rupee value. The buying and selling of dollar was recorded at Rs155.30/Rs155.60, the same previous day’s level, in cash ready market.

  • Investment in premium prize bonds surges by 157 percent

    Investment in premium prize bonds surges by 157 percent

    KARACHI: The investment in premium prize bonds of Rs40,000 denomination has witnessed unprecedented growth of 157 percent after the government announcement to discontinue bearer prize bonds of same denomination.

    According to official documents, the investment in premium prize bonds of Rs40,000 denomination surged by 157 percent to Rs15.86 billion by September 2019 as compared with Rs6.17 billion as of May 2019.

    The government on June 24, 2019 announced to discontinue the circulation of Rs40,000 denomination bearer prize bond.

    After the decision of the government people have surrendered Rs222 billion bearer bonds of Rs40,000 denomination by September 2019, which is around 86 percent of the total invested amount till May 2019.

    The State Bank of Pakistan (SBP) following the announcement issued procedure for the banks to facilitate general public in exchanging the unregistered prize bonds through three different modes.

    The SBP has barred the exchange of bearer prize bonds against cash.

    However, it can be redeemed against registered or premium prize bonds or can be converted into national saving schemes or face value (direct transfer to the bank account of bond bolder).

    The bearer instruments have been known as parking lot for undocumented economy. Therefore, the government launched registered prize bonds of Rs40,000 denomination in March 2017 which could be purchased against certain requirements including Computerized National Identity Card (CNIC) and valid bank account.

    According to the SBP the bearer instrument can also be exchanged in savings schemes such as Special Saving Certificates (SSC) or Defence Saving Certificates (DSC).

    The total investment into the saving certificates increased to Rs2.317 trillion by September 2019 as compared with Rs2.2 trillion by May 2019.

    The government is intended to transform all the bearer prize bonds into to registered securities. In this regard the Central Directorate of National Savings in collaboration with SBP is planning to issue scripless registered prize bonds amongst all denominations with objective to document the economy.

  • Profit rates on saving schemes reduced

    Profit rates on saving schemes reduced

    KARACHI: The government has reduced the profit rates on saving certificates effect from November 01, 2019.

    According to notifications issued by Central Directorate of National Savings (CDNS) on Tuesday, the profit rate on Defence Saving Certificate reduced by 2.33 percent to 10.68 percent.

    The profit rate on Pension Behbood has been slashed by 2.28 percent to 12.48 percent.

    The profit rate on Regular Income Certificate has been cut by 2.04 percent to 10.92 percent.

    Similarly, the profit rate on Special Saving Certificate has been cut by 1.70 percent to 11 percent.

    The profit rate on saving accounts has been slashed by 2.05 percent to 8.20 percent.

    Khurram Schehzad, CEO, Alpha Beta Core said that the reduction in profit rate had been done in line with declining secondary market yields on bonds.

    “Decline in fixed income profit rates is going to be positive for equities/stock market,” he added.

  • Market gains 81 points in buying activities

    Market gains 81 points in buying activities

    KARACHI: The stock market gained 81 points on Tuesday in an aggressive buying session.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 35,358 points as against 35,277 points showing an increase of 81 points.

    Analysts at Arif Habib Limited said that the market showed vibrancy in the early hours of trading that saw an increase of 331 points in total, but ending the session at 81 points.

    Banks and E&P sector largely resisted the increase in index, besides LUCK among cement sector stocks.

    Fertilizer sector showed mixed trend, however, Chemical, O&GMCs and Autos sector contributed positive to the Index.

    On the back of possible expansion from ARY Communications, WTL performed well and registered high trading volumes (27 percent of total volumes).

    In addition, overall trading volumes also hit a consecutive recent high of 300 million. Technology sector remained in the limelight with 99.4 million shares, followed by Cement (40.8 million) and Chemical (28.4 million).

    Among scrips, WTL realized volumes of 81.7 million, followed by MLCF (15.3 million) and LOTCHEM (12.7 million).

    Sectors contributing to the performance include Fertilizer (+28 points), Autos (+21 points), Chemical (+20 points), Textile (+18 points), O&GMCs (+18 points), Power (-34 points) and Banks (-24 points).

    Volumes increased further from 207.8 million shares to 308.1 million shares (+48 percent DoD). Average traded value also increased by 2 percent to reach US$ 55.6 million as against US$ 54.4 million.

    Stocks that contributed significantly to the volumes include WTL, MLCF, LOTCHEM, TRG and EPCL, which formed 42 percent of total volumes.

    Stocks that contributed positively include ENGRO (+32 points), MCB (+32 points), SNGP (+21 points), INDU (+14 points) and COLG (+9 points).

    Stocks that contributed negatively include HUBC (-43 points), UBL (-19 points), LUCK (-15 points), FFC (-13 points), and HBL (-12 points).

  • Rupee ends firmer amid inflows

    Rupee ends firmer amid inflows

    KARACHI: The Pak Rupee ended firmer against the dollar on Tuesday amid inflows of foreign currency into the interbank market.

    The rupee ended Rs155.64 to the dollar from previous day’s closing of Rs155.65 in interbank foreign exchange market.

    Currency dealers said that the market witnessed sufficient supply of dollar into the market. However, demand for import and corporate payments were also higher.

    The foreign currency market was opened in the range of Rs155.60 and Rs155.65. The market recorded day high of Rs155.65 and low of Rs155.55 and closed and Rs155.64.

    The exchange rate in open market however witnessed appreciation in value of the local unit.

    The buying and selling of dollar was recorded at Rs155.30/Rs155.60 from previous day’s closing of Rs155.45/Rs155.65 in cash ready market.

  • Sales tax refund promises annoy value added textile industry

    Sales tax refund promises annoy value added textile industry

    KARACHI: The value added textile industry has expressed its displeasure over government’s repeated promises of clearing sales tax refunds.

    The government made promises for the past several months to clearing pending sales tax refunds but failed to honor, said Jawed Bilwani, Chief Coordinator of the Value Added Textile Export Sector said on Tuesday in a joint press conference at Pakistan Hosiery Manufacturers Association (PHMA) House.

    He said that the value added industry was facing serious liquidity problems due to stuck up refunds.

    The prime minister assured the business community to resolve the issue of refunds completely through a new mechanism. Besides, Hafeez Shaikh, Advisor to Prime Minister on Finance and Revenue and Syed Shabbar Zaidi, Chairman, Federal Board of Revenue (FBR) also promised the refunds would be issued when exporters would file their goods declarations.

    Instead tall claims the situation has further aggravated, Bilwani said.

    He said that around 40 percent of the industry was facing immense liquidity problems. “This resulted in closure of factories,” he added.

    For the past pending sales tax refunds, the government issued bonds, which were never encahsed, he said.

    For the past four months the government was repeatedly assuring to resolve the issue, he said, adding that nothing was done in this regard.

    He said that on the one side the government was endeavoring to increase the exports but on the other side it was silent on the issue of refunds.