Author: Mrs. Anjum Shahnawaz

FBR appoints appraising, valuation officers

ISLAMABAD: Federal Board of Revenue (FBR) has appointed appraising and valuation officers (BS-16) in the Customs Department.

A notification issued on Thursday, the FBR said that consequent upon the recommendations of Federal Public Service Commission (FPSC), Islamabad vide letter No.F.4-180/2018-R-FS-I, dated 17.10.2019 and having accepted the terms and conditions of appointment contained in the offer of appointment letter No.2(9)/2015-Cus-III, dated 22.10.2019, the following candidates are hereby appointed as Appraising/ Valuation Officer (BS-16) in the Customs Department and their services are placed at the disposal of Customs field formations mentioned against each:-

01. Raafeh Nasar Chattha, Model Customs Collectorate (Appraisement) Lahore.

02. Haris Bukhtiar Khan, Model Customs Collectorate (Appraisement) Lahore.

03. Muhammad Ibrar Ibrahim, Model Customs Collectorate (Appraisement) Lahore.

The FBR said that their inter-se-seniority will be maintained in order of merit assigned by Federal Public Service Commission (FPSC) and in accordance with the Civil Servants (Seniority) Rules, 1993.

Other terms and conditions of their appointment will be the same as already conveyed vide FBR letter dated October 22, 2019.

3. They are advised to join the concerned Customs field formation immediately but not later than 06.12.2019.

November 21, 2019
SECP directs life insurers to provide details of window Takaful operations

ISLAMABAD: Securities and Exchange Commission (SECP) has directed life insurers to provide details of their Family Takaful operations.

The SECP issued Circular No. 15 dated November 18, 2019 and amended rules for financial reporting of family window Takaful operations by life insurers.

The regulator amended the rules and directed to insurance companies having window Takaful operations to:

— report its assets, liabilities, revenues and expenses separately for each segment of its conventional business and Takaful business;

— to comply with the provisions of these rules or such other conditions as may be imposed by the Commission from time to time.

The SECP under Takaful Rules 2012 also imposed following conditions on life insurers related to financial reporting of their window Takaful operations:

1. Life insurers authorized to carry on window takaful operations shall include the Family Takaful results in their published financial statements as follow:

a. The assets and liabilities of the window family takaful operations shall be consolidated with the assets and liabilities of the conventional operations in the statement of financial position of the life insurer.

b. The incomes and expenses of the window family takaful operations shall be consolidated with the incomes and expenses of the conventional operations in the profit and loss account of the life insurer.

c. Supporting notes where considered necessary for understanding of the users of financial statements shall be included as part of the notes to the financial statements; and

d. The segment disclosure for Family Takaful Operations in accordance with the requirements of IFRS 8- Operating Segments shall be included in the financial statements.

The SECP further directed that in the financial statements the retained earnings of the Participant Takaful Fund (PTF) shall be classified as insurance liability and included in the total liabilities of the Window Family Takaful Operations. Balance of the Operator Sub-Funds under the Window Family Takaful operations, shall be classified as part of shareholders’ equity of the life insurer presented separately into (i) retained earnings attributable to shareholders – ledger account D; and (ii) other components.

The regulator further directed that life insurers shall separately prepare financial statements for Family Takaful operations as if these are carried out by a standalone Takaful Operator and shall be annexed with the insurer’s annual/interim report (as applicable). Supporting notes where considered necessary for understanding of the users of separate financial statements shall be included as part of the notes to the separate financial statements.

“Accordingly, all life insurers undertaking Family Takaful business through window operations are directed to ensure that the financial statements for the periods commencing January 01, 2020 with the SECP under the provisions of applicable laws are in compliance with the conditions placed above.”

November 21, 2019
Non-ATL to pay 20 percent tax on property sale through auction

KARACHI: Properties sold through auction to attract 20 percent advance tax for persons not appearing on Active Taxpayers List (ATL).

According to Income Tax Ordinance, 2001 updated till June 30, 2019 the advance tax rate on sale of property through auction would be 10 percent for persons, who filed their income tax returns by due date or filed after paying penalty.

However, the tax rate has been prescribed at 20 percent for persons not appearing on the ATL.

A taxpayer will only qualify for the ATL when he files annual income tax returns by due date or filed after due date with paying penalty.

Through Finance Act, 2019 a new Tenth Schedule was introduced to Income Tax Ordinance, 2001 under which persons not appearing on ATL will pay 100 percent additional tax.

Section 236 A of the Ordinance explained the advance tax at the time of sale by auction:

Section 236A: Advance tax at the time of sale by auction

Sub-Section (1): Any person making sale by public auction or auction by a tender, of any property or goods (including property or goods confiscated or attached) either belonging to or not belonging to the Government, local Government, any authority, a company, a foreign association declared to be a company under sub-clause (vi) of clause (b) of sub-section (2) of section 80, or a foreign contractor or a consultant or a consortium or Collector of Customs or Commissioner of Inland Revenue or any other authority, shall collect advance tax, computed on the basis of sale price of such property and at the rate specified in Division VIII of Part IV of the First Schedule, from the person to whom such property or goods are being sold.

Sub-Section (2): The credit for the tax collected under sub-section (1) in that tax year shall, subject to the provisions of section 147, be given in computing the tax payable by the person purchasing such property in the relevant tax year or in the case of a taxpayer to whom section 98B or section 145 applies, the tax year, in which the “said date” as referred to in that section, falls or whichever is later.

Explanation.- For the purposes of this section, sale of any property includes the awarding of any lease to any person, including a lease of the right to collect tolls, fees or other levies, by whatever name called.

Sub-Section (3): Notwithstanding the provisions of sub-section (2), tax collected on a lease of the right to collect tolls shall be final tax.”

November 21, 2019
Share of payment to Chinese imports increases 21.42pc

KARACHI: The share of import payment to China has increased to 21.42 percent during first four months (July – October) 2019/2020 as compared with share of 18 percent in the corresponding period of the last fiscal year.

The total payment for import from China was at $3.14 billion during first four months of current fiscal year out of Pakistan’s total import bill of $14.65 billion for the same period, according to statistics released by State Bank of Pakistan.

The total payment for import from China was at $3.45 billion in first four months of fiscal year 2018/2019 when total import bill for the period was $19.02 billion.

The payment for total import bill has registered 23 percent decline to $14.656 billion during first four months of current fiscal year as compared with $19.016 billion in the corresponding months of the last fiscal year.

The payment for import from China, however, also declined but by 9.14 percent to $3.14 billion during first four months of current fiscal year as compared with $3.45 billion in the same period of the last fiscal year.

China is remained the largest exporting country for Pakistani markets during the first four months of current fiscal year.

The United Arab Emirates (UAE) is the second largest exporting country for Pakistani markets during the period under review.

However, the import payment to UAE fell sharply by 30 percent and stood at $2.44 billion during first four months of current fiscal year as compared with $3.5 billion in the corresponding period of the last fiscal year.

The share of import payment to UAE in total import payment of Pakistan also fell to 16.68 percent during July – October 2019/2020 as compared with share of 18.44 percent in total import bill in July – October 2018/2019.

Pakistan has taken several measures during the past couple of years to discourage imports of luxury and non-essential items.

The decline in import bill during the first four months can be attributed to those measures taken by the government.

November 21, 2019
FBR starts air travelers’ monitoring to detect money launderers, drug smugglers

ISLAMABAD: Federal Board of Revenue (FBR) has launched passenger profiling system at international airports to curb money laundering and drug smuggling.

A statement on Thursday said that Pakistan Customs, a wing of the FBR, has launched a specialized Risk Management System for passenger profiling at all major international airports in Pakistan.

This exercise is part of the Customs Border Management Initiative (BMI) recently approved by the prime minister.

The Passenger Profiling System, “Global Travelers Assessment System” (GTAS) is now operational at seven major airports of the country for which Customs staff has been adequately trained.

Moreover, World Customs Organization (WCO) and US Customs and Border Protection (US CBP) have provided Technical assistance for deployment and implementation of the project.

The system is capable of carrying out passenger profiling and targeting through Advance Passenger Information (API) and Passenger Name Record Information (PNR) for interdiction of suspected travelers, drug smugglers and money-launders etc. while adhering to the requirements of FATF action plan.

It will also help in creating profiles of passengers travelling to and from Pakistan and generate risk indicators in advance using a proactive methodology for effective border management.

According to Chairman FBR Syed ShabbarZaidi, the GTAS will also enable Customs to achieve the “Invisible Customs approach” with least presence at airports while facilitating the genuine passengers.

The Chairman has also directed Member Customs Operations to ensure adequate training sessions for customs officers while initiating data sharing with border agencies which will serve as a targeting portal for all law enforcement agencies at Pakistan Customs National Targeting Centre.

November 21, 2019
Pakistan spends $531mn on vehicle import in 4 months

KARACHI: Pakistan has spent $531 million on vehicle import in the first four months (July – October) of the current fiscal year, according to official data released on Wednesday.
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November 20, 2019
Stock market falls by 527 points on profit taking

KARACHI: The stock market fell by 527 points on Wednesday as investors opted for profit taking following the bull run during past few days.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 38,038 points as against 38,564 points showing a decline of 527 points.

After managing a bull run that added around 10,000 points from its low, the market finally took corrective stance with index plunging 527 points and closing the session at that note.

Selling pressure was evident in Cement, E&P, O&GMCs and banking sector stocks.

Although dust is seemingly settling on political front, investors took cue from T-bill auction that saw yields increasing further and considered it best to book profit prior to announcement of monetary policy on Friday November 22, 2019. Street consensus is for status quo.

Index is so far maintaining healthy volumes registering 327 million shares as compared with 385 million in the previous session.

Majority of the volumes were traded in Technology with 50.4 million shares, followed by Engineering (38 million) and Banks (33 million).

Among scrips, WTL led the volumes with 28.3 million shares, followed by BOP (17.1 million) and PAEL (15.1 million).

Sectors contributing to the performance include Banks (-203 points), E&P (-113 points), Cement (-49 points), Fertilizer (-30 points) and Chemical (-24 points).

Volumes declined further from 385.3 million shares to 327.4 million shares.

Average traded value also declined by 19 percent to reach US$ 73.4 million as against US$ 90.5 million.

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

Stocks that contributed positively include FFC (+24 points), NATF (+10 points), THALL (+7 points), ISL (+7 points) and AGP (+5 points).

Stocks that contributed negatively include HBL (-63 points), ENGRO (-49 points), OGDC (-35 points), UBL (-34 points), and MCB (-33 points).

November 20, 2019
Rupee eases in range bound trading

KARACHI: The Pak Rupee ended down by one paisa against dollar on Wednesday in range bound trading activities.

The rupee ended Rs155.37 to the dollar from previous day’s closing of Rs155.36 in interbank foreign exchange market.

Currency dealers said that the market was remained calm as neither major demand seen from importers nor inflows of export receipts.

The foreign currency market was opened in the range of Rs155.35 and Rs155.40. The market recorded day high of Rs155.37 and low of Rs155.35 and closed at Rs155.37.

The exchange rate in open market witnessed slight change in rupee value. The buying and selling of dollar was recorded at Rs155.20/Rs155.40 from previous day’s closing of Rs155.20/Rs155.50 in cash ready market.

November 20, 2019
FBR extends date for filing sales tax return

ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday extended the last date for filing sales tax return up to November 25, 2019.

The FBR issued a circular dated November 20, 2019 and extended the date of submission of sales tax and federal excise return up to November 25, 2019 for the tax period of October 2019, which was due on November 18, 2019.

The FBR directed all chief commissioners Inland Revenue of Large Taxpayers Units (LTUs) and Regional Tax Offices (RTOs) to comply with the instructions and disseminate information to taxpayers.

November 20, 2019
Income tax on low cost housing projects reduced by 50 percent

KARACHI: The income tax rate on low cost housing projects shall be reduced by 50 percent, according to income tax law recently updated by the Federal Board of Revenue.

The FBR updated Income Tax Ordinance, 2001 incorporating changes introduced through Finance Act, 2019.

As per Second Schedule of the updated Ordinance, the tax payable on profits and gains derived by a person from low cost housing projects shall be reduced by fifty percent.

The reduction in tax liability under this clause shall apply to such project which is—

(a) owned and managed by a company formed for operating the said project and registered under the Companies Act, 2017 and having its registered office in Pakistan; and

(b) not formed by the splitting up, or the reconstruction or reconstitution, of a business already in existence or by transfer to a new business of any machinery or plant used in a business which was being carried on in Pakistan at any time before the commencement of the new business; and

(c) a low cost housing project under which the maximum sale price of a single housing unit is two and a half million rupees.

November 20, 2019