ISLAMABAD: Prime Minister Imran Khan on Monday directed authorities to intensify efforts to attract more investment from China, underscoring the importance of industrialization and economic growth for Pakistan’s future.
(more…)Author: Faisal Shahnawaz
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ECC approves cash reward for promotion of IT exports
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Monday approved cash reward for incentivizing IT exports and to encourage documentation of exporters/exports.
Federal Minister for Finance and Revenue, Shaukat Tarin, presided over the meeting of the ECC of the Cabinet, held at the Finance Division.
The ECC approved the allocation of Rs 4 billion to PSEB for disbursement of cash reward incentive in order to incentivize IT exports and to encourage documentation of exporters/exports.
The cash reward incentive shall be provided for the IT and IT-enabled services exporters promoting export proceeds through banking channels via State Bank of Pakistan (SBP) allocated banking codes.
The ECC considered and approved a summary presented by the Ministry of Information Technology and Telecommunication regarding allocation of Rs. 2 billion as a single line budget for Pakistan Software Export Board (PSEB), an apex Government body, mandated to strengthen and promote the IT sector exports of Pakistan.
Federal Minister for Industries and Production Khusro Bakhtiar, Federal Minister for Energy Hammad Azhar, Federal Minister for Railways Azam Khan Swati, Minister of State for Information Farrukh Habib, Advisor to PM on Commerce Abdul Razak Dawood, Federal Secretaries and other senior officers participated in the meeting.
Secretary, Ministry of Industries and Production presented a summary regarding provision of gas to Pak Arab and Fauji Fertlizer Bin Qasim Limited (FFBQL) to review demand for urea fertilizer during the Rabi season 2021-22.
After detailed discussion, the ECC approved maximum provision of gas to Pak Arab (58MMCFD) and FFBQL (63MMCFD) to ensure that estimated demand for urea fertilizer is met through domestic production. The decision will stabilize prices of urea fertilizer and ensure its smooth supply throughout the country during Rabi season 2021-22.
Lastly, Ministry of Commerce presented a Textile and Apparel Policy, FY 2020-25. After due deliberation, the ECC constituted a sub-committee comprising of representatives of Ministry of Commerce, Finance Division, Ministry of Industries and Production, Power and Petroleum Divisions, FBR and State Bank of Pakistan to review and present an updated policy before ECC in a couple of weeks.
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IR officers to freeze bank accounts for tax recovery
ISLAMABAD: The officers of Inland Revenue (FBR) have been authorized to access bank accounts of taxpayers for recovery of outstanding duty and taxes.
In an official memo issued on Monday, the Federal Board of Revenue (FBR) has restored the powers of Commissioners IR to exercise their powers under Income Tax Ordinance, 2001 and Sales Tax Act, 1990 regarding recovery of tax dues through attachment of bank accounts.
A non-bureaucrat FBR chairman Syed Shabbar Zaidi on May 10, 2019 through an official notice barred the tax authorities for attachment of bank accounts prior information to taxpayers.
“No bank accounts attachment unless the taxpayer’s CEO/Principal Officer / owner is informed at least 24 hours prior to attachment and the Chairman FBR’s approval is obtained.”
However, the latest official note stated that in order to implement the law in its true spirit and to re-vest the power vested in the institution of the Commissioners viz-a-viz action under Section 140 of the Income Tax Ordinance, 2001, the instruction referred supra (the previous one) are hereby withdrawn ab-initio.
Syed Shabbar Zaidi headed the organization from May 10, 2019 to January 06, 2020. Zaidi lamented the decision through his tweet.
“I am personally sorry to hear the withdrawal of the first instruction issued when I joined as Chairman FBR. No freezing of bank account without intimation & approval from Chairman FBR. Due to this there was a major relief to taxpayers. I urge Prime Minister, Finance Minister & Chairman FBR to reinstate.”
When I was working in an organization where 99.99 per cent staff is interested in power then one man can only be effective when stakeholders support. It was not so, he added.
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Tax ordinance empowers FBR to make rules
Section 237 of Income Tax Ordinance, 2001 has explained the tax ordinance empowered the Federal Board of Revenue (FBR) to make rules.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
Following is the text of Section 237 of Income Tax Ordinance, 2001:
237. Power to make rules.—(1) The Board may, by notification in the official Gazette, make rules for carrying out the purposes of this Ordinance.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:–
(a) the manner in, and procedure by, which the income, profits and gains chargeable to tax and the tax payable thereon under this Ordinance shall be determined in the case of –
(i) income derived partly from agriculture and partly from other business; or
(ii) non-resident persons;
(ab) ascertainment or determination of any income or class of income to be included in the total income of a taxpayer and any deduction from such income;
(b) fees and other charges to be paid in respect of any matter referred to in this Ordinance;
(c) anything which is to be or may be prescribed under this Ordinance;
(d) the procedure for furnishing returns and other documents as required under this Ordinance, including on computer media or through electronic medium or for issuance of orders or notices, or levy of default surcharge or penalty through electronic medium;
(da) the procedure for approval of a non-profit organization;
(e) contain provisions of a saving or transitional nature consequent upon the making of this Ordinance; and
(f) penalties for the contravention of the rules made under this Ordinance.
(3) The power to make rules conferred by this section shall be, except on the first occasion of the exercise thereof, subject to the condition of previous publication.
(4) Where rules made under this section –
(a) adversely affect a person;
(b) are of a transitional nature; and
(c) are made within twelve months after commencement of this Ordinance,
these may provide that they shall take effect from the date on which this Ordinance comes into force or a later date.
(Disclaimer: The text of the above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
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KIBOR rates on October 11, 2021
KARACHI: State Bank of Pakistan (SBP) on Monday issued the following Karachi Interbank Offered Rates (KIBOR) on October 11, 2021.
Tenor BID OFFER 1 – Week 7.21 7.71 2 – Week 7.25 7.75 1 – Month 7.29 7.79 3 – Month 7.71 7.96 6 – Month 8.06 8.31 9 – Month 8.36 8.86 1 – Year 8.61 9.11 -
SBP issues customers exchange rates for October 11
Karachi, October 11, 2021: The State Bank of Pakistan (SBP) has released the official exchange rates for Monday, October 11, 2021.
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Advance tax not applicable on certain authorities
Section 236O of the Income Tax Ordinance, 2001 outlines specific authorities exempted from the obligation to pay advance tax.
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Dr. Alvi opens property exhibition for UAE based NRPs
KARACHI: Pakistan President Dr. Arif Alvi has inaugurated a property exhibition for the UAE based Non-Resident Pakistanis (NRPs) arranged by Pakistani banks offering Roshan Digital Account (RDA), in partnership with builders and developers, to showcase their products being offered under RDA.
The president expressed the hope that Non-Resident Pakistanis (NRPs) living in UAE would take maximum advantage of the State Bank’s Roshan Apna Ghar scheme and use it to fulfill their and their families’ housing needs in Pakistan, according to a statement issued by the State Bank of Pakistan (SBP) on Saturday.
Abdul Razak Dawood, Advisor to Prime Minister on Commerce, Textile, Industries & Production and Investment was also present at the occasion.
The exhibition was attended by a large number of Pakistanis, various UAE based Pakistani associations, Senior State Bank of Pakistan (SBP) management, Presidents/CEOs of commercial banks, UAE and Pakistan based property developers, and Pakistan’s Embassy officials in UAE.
Appreciating the vast potential of UAE based NRPs, President Dr. Arif Alvi said Pakistanis living in the UAE have significantly contributed towards development and economic growth of UAE and most of them regard UAE as their second home. He said that UAE is a major destination for Pakistani workers and their contribution in remittances is significant.
He observed that SBP, with the active support of commercial banks, has provided NRPs a unique opportunity to buy a home that hitherto, had been a very difficult task for various reasons. He felt satisfied that finally an end-to-end digital process had made it possible for NRPs. He shared his thoughts divulging on various strengths as a nation that Pakistanis should be proud of.
In his welcome address, Governor SBP, Dr. Reza Baqir expressed his heartfelt gratitude to President Dr. Arif Alvi for sparing time and inaugurating the exhibition. He said that SBP has been able to introduce RDA and Roshan Apna Ghar following the vision of Prime Minister Imran Khan to integrate the NRPs with the country’s economy.
Recounting the massive success of RDA, the Governor elucidated that RDA has proved to be a huge success and become a household name connecting over 250,000 NRPs under one umbrella besides attracting over USD2.5 billion since its launch in September last year.
Adding further, he said that the overwhelming success of RDA and Naya Pakistan Certificates (NPCs) speak volumes of the immense popularity of the incumbent regime in the hearts and minds of NRPs.
He said it has been a priority of the government and SBP to resolve the issues of NRPs living across the globe, as they fully understand their potential for lifting the country’s economy. He said that international organizations were appreciating the economic growth of the country despite odds.
He noted that economy was heading in right direction and the unprecedented increase in foreign exchange reserves is an expression of confidence of overseas Pakistanis in the government’s economic policies.
Speaking on the occasion, Abdul Razaq Dawood assured the audience that economy is heading in the right direction and maintaining a healthy growth path. He especially mentioned textile and cement sector where growth trends are remarkable, while automobile, consumer goods and food and likes are following similar trend.
Dawood said that country’s exports growth has already picked up and he is confident that it will keep the momentum and grow further this year.
He also mentioned SBP’s Temporary Economic Refinance Facility (TERF) for helping industry expand and modernize, besides SBP’s various initiatives for facilitating the public at large.
Roshan Apna Ghar is an initiative of SBP for Non Resident Pakistanis (NRPs) to buy, build or renovate their homes in Pakistan through their own investment or bank financing.
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Advance tax on purchase of immovable property
Section 236K of Income Tax Ordinance, 2001 has explained the advance tax on purchase or transfer of immovable property.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
Following is the text of Section 236K of Income Tax Ordinance, 2001:
236K. Advance tax on purchase or transfer of immovable property.—(1) Any person responsible for registering, recording or attesting transfer of any immovable property shall at the time of registering, recording or attesting the transfer shall collect from the purchaser or transferee advance tax at the rate specified in Division XVIII of Part IV of the First Schedule.
Explanation,—For removal of doubt, it is clarified that the person responsible for registering, recording or attesting transfer includes person responsible for registering, recording or attesting transfer for local authority, housing authority, housing society, co-operative society, public and private real estate projects registered/governed under any law, joint ventures, private commercial concerns and registrar of properties.
(2) The advance tax collected under sub-section (1) shall be adjustable:
Provided that if the buyer or transferee is a non-resident individual holding a Pakistan Origin Card (POC) or National ID Card for Overseas Pakistanis (NICOP) or Computerized National ID Card (CNIC) who has acquired the said immovable property through a Foreign Currency Value Account (FCVA) or NRP Rupee Value Account (NRVA) maintained with authorized banks in Pakistan under the foreign exchange regulations issued by the State Bank of Pakistan, the tax collected under this section from such persons shall be final discharge of tax liability for such buyer or transferee.
(3) Any person responsible for collecting payments in installments for purchase or allotment of any immovable property where the transfer is to be effected after making payment of all installments, shall at the time of collecting installments collect from the allotee or transferee advance tax at the rate specified in Division XVIII of Part IV of the First Schedule:
Provided that where tax has been collected along with installments, no further tax under this section shall be collected at the time of transfer of property in the name of buyer from whom tax has been collected in installments which is equal to the amount payable in this section.
(4) Nothing contained in this section shall apply to a scheme introduced by the Federal Government, or Provincial Government or an Authority established under a Federal or Provincial law for expatriate Pakistanis:
“Provided that the mode of payment by the expatriate Pakistanis in the said scheme or schemes shall be in the foreign exchange remitted from outside Pakistan through normal banking channels.”
(Disclaimer: The text of the above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
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Advance tax collection by educational institutes
Section 236I of Income Tax Ordinance, 2001 tells about the collection of advance tax by educational institutes.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
Following is the text of Section 236I of Income Tax Ordinance, 2001:
236I. Collection of advance tax by educational institutions.— (1) There shall be collected advance tax from a person not appearing on the active taxpayers’ list at the rate specified in Division XVI of Part-IV of the First Schedule on the amount of fee paid to an educational institution.
(2) The person preparing fee voucher or challan shall charge advance tax under sub-section (1) in the manner the fee is charged.
(3) Advance tax under this section shall not be collected from a person on an amount which is paid by way of scholarship or where annual fee does not exceed two hundred thousand rupees.
(4) The term “fee” includes, tuition fee and all charges received by the educational institution, by whatever name called, excluding the amount which is refundable.
(5) Tax collected under this section shall be adjustable against the tax liability of either of the parents or guardian making payment of the fee.
“(6) Advance tax under this section shall not be collected from a person who is a non-resident and,—
(i) furnishes copy of passport as an evidence to the educational institution that during previous tax year, his stay in Pakistan was less than one hundred eighty-three days;
(ii) furnishes a certificate that he has no Pakistan-source income; and
(iii) the fee is remitted directly from abroad through normal banking channels to the bank account of the educational institution.”
Advance tax collected by educational institutes
The rate of collection of tax under section 236I shall be 5% of the amount of fee.
(Disclaimer: The text of the above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)