Pkrevenue.com

Author: Faisal Shahnawaz

  • FBR allows duty drawback on supplementary food items

    FBR allows duty drawback on supplementary food items

    ISLAMABAD: Federal Board of Revenue (FBR) has allowed duty drawback on import of ready to use supplementary food, which included palm oil and skimmed milk.

    The FBR on Tuesday issued SRO 341(I)/2020 to allow 5.33 percent freight on board (fob) to the extent of customs duty. The duty drawback is available from April 27, 2020.

    The facility has been allowed to items falling under HS Code 2106.9090, which included:

    01. RBD Palm Olien

    02. RBD Canola Oil

    03. Skimmed Milk Powder

    04. Emulsifier

    05. Vitamin and Mineral Premix

    06. Anti Oxidant

    07. Whey Powder

    08. Peanuts

  • Domestic oil sales plunge by 35 percent in April

    Domestic oil sales plunge by 35 percent in April

    KARACHI: The domestic sales of petroleum products have plunged by 35 percent to 1.07 million tons in April 2020 as compared with 1.65 million tons in the same month of the last year.

    However, the sales in April 2020 increased by three percent when compared with 1.03 million tons in March 2020.

    Analysts at Arif Habib Limited attributed the increase in sales of petroleum products to: 1) Surge in sales of HSD on account of higher demand from agriculture sector given beginning of wheat harvesting season, and 2) Closure of Iran border resulting in lower availability of illegally dumped fuel.

    Pertinently, sales of FO, MS and HSD witnessed a steep decline of 75 percent, 36 percent and 16 percent YoY to 0.07 million tons, 0.44 million tons and 0.55 million tons, respectively.

    As per market sources, oil consumption witnessed a rising trend since the government opted for a ‘smart lockdown’ and issued Standard Operating Procedures (SOP) for construction and export oriented industries.

    However, if lockdown is extended (deadline is May 09, 2020) then this will be negative for May 2020 sales.

    On a monthly basis, MS sales dropped by 21 percent MoM while HSD and FO volumes grew by 41 percent and 2 percent MoM respectively.

    The analysts expect demand for furnace oil to increase in upcoming months due to higher demand of power in summer season coupled with historic low prices (FO touched USD 77/M.T on 22nd April’20) which may improve merit order of furnace oil based power plants.

    During first ten months of current fiscal year, total White and Black Oil sales clocked-in at 13.35 million tons, depicting a decline of 13 percent YoY due to dip in sales volumes of MS, HSD and FO by 3 percent, 15 percent and 31 percent YoY, respectively.

    Motor Gasoline sales witnessed a meager decline of 3 percent YoY to 5.99 million tons due to the Coronavirus. However, massive reduction in price will increase demand as customers will prefer petrol over Compressed Natural Gas (CNG). High Speed Diesel (HSD) sales shrunk by 15 percent YoY to 5.15 million tons led by i) Sharp slowdown in Agriculture sector, ii) Negative growth of 3.03 percent YoY in the manufacturing sector of LSM, and iii) Availability of smuggled HSD from Iran, which is cheaper in contrast to official imported product.

    Meanwhile, FO is being replaced by other sources namely Coal, Hydel and RLNG, resulting in a decline of 31 percent YoY to 1.68 million tons compared to 2.44 million tons in SPLY.

  • PQGTL signs agreement with Gabitt

    PQGTL signs agreement with Gabitt

    KARACHI:  Pak-Qatar General Takaful Limited (PQGTL) has signed an agreement with Gabitt, a ride hailing service.

    The ceremony, which was held recently, was attended by Nasir Ali Syed, CEO Pak-Qatar General Takaful Limited and Farhan Ahmed, CEO L1 Solution Private Limited along with other senior officials from both the companies.

    Through this strategic alliance, the users and driving partners of Gabitt will have an opportunity to avail various coverage solutions specifically designed and developed by Pak-Qatar General Takaful.

    While speaking on the occasion, Nasir Ali Syed said: “This agreement with Gabitt will surely bring a positive change in the life of the driving partners as they are more prone to risks when they are out on the roads.

    “Offering complementary Takaful Coverage will give them the much needed comfort and peace of mind that will eventually translate into a better performance, required social security and enhanced loyalty.

    “Moreover, the optional coverage solutions, available to them online, will allow driving partners and users of Gabitt to avail coverage needs efficiently without any hassle.”

    Farhan Ahmed on the occasion said, “We realize how important our driving partners are to us and we consider them as our family members.

    “Therefore, their protection and comfort has been our top priority.

    “I hope this collaboration will be beneficial for both Pak-Qatar Takaful and Gabitt which will further lead to a long-term business relationship.”

  • Export tariffs, tax slabs may not change in budget: Razak Dawood

    Export tariffs, tax slabs may not change in budget: Razak Dawood

    ISLAMABAD: The government is likely to maintain the current export tariffs and tax slabs in the forthcoming budget, according to Abdul Razak Dawood, Advisor to the Prime Minister on Commerce and Investment.

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  • Stock market gains 76 points amid profit taking

    Stock market gains 76 points amid profit taking

    KARACHI: The stock market gained 76 points on Tuesday amid profit taking during the day.

    The benchmark KSE-100 of Pakistan Stock Exchange (PSX) closed at 33,993 points as against 33,917 points showing an increase of 76 points.

    Analysts at Arif Habib Limited said that courtesy of crudes’ performance in the international market, KSE-100 posted decent gains during the session, realizing +469 points and closing the session +76 points.

    E&P and OMCs remained in the limelight but also saw profit booking near yesterday’s levels and caused OGDC and PPL to settle low.

    Cement and Fertilizer sectors saw further weakness, whereas Banks also contributed to downside in Index. Cement sector topped the chart with 58.4 million shares, followed by O&GMCs (38.7 million) and Technology (26.9 million). Among scrips, HASCOL realized trading volumes of 33.8 million shares, followed by UNITY (25.4 million) and FCCL (17.8 million).

    Sectors contributing to the performance include E&P (+83 points), O&GMCs (+49 points), Food (+13 points), Cement (-39 points), Banks (-23 points).

    Volumes increased from 216.5 million shares to 261 million shares (+21 percent DoD). Average traded value declined by 1 percent to reach US$ 57.6 million as against US$ 58.4 million.

    Stocks that contributed significantly to the volumes include HASCOL, UNITY, FCCL, MLCF and PAEL, which formed 41 percent of total volumes.

    Stocks that contributed positively to the index include PPL (+34 points), ENGRO (+34 points), OGDC (+27 points), PSO (+23 points) and POL (+18 points). Stocks that contributed negatively include HBL (-33 points), FFC (-29 points), COLG (-19 points), EFERT (-10 points), and KTML (-10 points).

  • Rupee appreciates by 26 paisas against dollar

    Rupee appreciates by 26 paisas against dollar

    KARACHI: The Pak Rupee gained another 26 paisas against dollar on Tuesday owing to better economic indicators amid coronavirus pandemic.

    The rupee ended Rs159.65 to the dollar from previous day’s closing of Rs159.91 in interbank foreign exchange market.

    The local currency gained 56 paisas during past two days.

    Currency experts said that the rupee appreciated due to inflows of IMF funds and decline in international oil prices.

    They said that local currency would gain in coming trading days due to fall in international oil prices and improved external accounts.

    They said that that improved foreign direct investment and shrinking current account deficit helped the local currency to make gain.

    The inflow of Foreign Direct Investment (FDI) into Pakistan has witnessed sharp growth of 137 percent during first nine months (July – March) 2019-2020.

    The FDI increased to $2.15 billion during first nine months of current fiscal year as compared with $905 million in the corresponding period of the last fiscal year.

    Current account deficit (CAD) has contracted by 73 percent during first nine months (July – March) 2019/2020 due to significant decline in import bill.

    The current account deficit fell to $2.77 billion during first nine months of current fiscal year as compared with $10.28 billion in the corresponding period of the last fiscal year.

  • FPCCI suggests measures to broaden tax base, improving tax to GDP ratio

    FPCCI suggests measures to broaden tax base, improving tax to GDP ratio

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has suggested measures to broaden tax base and improving tax to GDP ratio.

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  • Exemption from withholding tax at import stage suggested

    Exemption from withholding tax at import stage suggested

    KARACHI: Pakistan Business Council (PBC) has suggested the tax authorities to exempt withholding tax at import stage for avoiding generation of tax refunds and expansion of industry.

    In its proposals for budget 2020/2021, the PBC recommended exemption from collection of withholding tax under section 148 at import stage and exemption for manufacturing concerns under Section 153.

    It said that procedures and rules for obtaining exemption certificates for import of plant and machinery and raw material by tax payers have serious restrictions, which causes hardship.

    Corporate manufacturing sector should be excluded from the purview of income tax withholding at import stage under section 148 as well as from tax deduction on local supply under section 153.

    Similar exemption is already given to the greenfield industries through the Finance Supplementary Second Amendment Act 2019 announced in March 2019.

    The same exemption, however, is not available, for the brownfield expansion.

    Moreover, all the companies engaged in manufacturing should be exempt from withholding of tax under section 153.

    Similar exemption is available for Sales Tax in the Sales Tax Special Procedure (Withholding) Rules, 2007 via SRO 586 dated July 1, 2017.

    Alternatively, issuance of exemption certificate from withholding under sections 148 and 153 should automatically trigger on the FBR portal based on payment of quarterly advance tax under section 147 to avoid harassment of genuine taxpayers.

    This will enable taxpayers to avoid creating huge tax refunds and focus on more expansion.

    This would increase the investments for brownfield capacity expansion as well and would provide a meaningful relief (similar to greenfield expansion) with regard to BMR and extension / expansion. Further, it will also attract foreign direct investment in the form of new expansion ventures as well as partnerships and hence will also result in export growth.

  • PVC, PMC material allowed sales tax zero rating; Export Policy Order amended

    PVC, PMC material allowed sales tax zero rating; Export Policy Order amended

    ISLAMABAD: The ministry of commerce has allowed zero rating of sales tax on supply of PVC and PMC meterials from Export Processing ZOnes, Manufacturing Bonds and export oriented units.

    The commerce ministry on Monday issued SRO 351(I)/2020 dated May 04, 2020 to amend Export Policy Order 2016 regarding supply of PVC and PMC materials.

    According to the amendment: “… the export of PVC and PMC (HS Code 3901-3914) materials from the Export Processing Zones, manufacturing bonds and export oriented units shall be eligible for zero rating of sales tax.

    Through the SRO the ministry also amended the negative list for export to Afghanistan.

    The SRO omitted the entry of PVC and PMC from the third schedule of the Export Policy Order 2016.

  • FBR extends time limit for filing goods declaration

    FBR extends time limit for filing goods declaration

    KARACHI: Federal Board of Revenue (FBR) has extended time limit for filing goods declaration in order to facilitate trade considering problems faced during lockdown.

    The FBR on Monday issued a notification for extension in time limit for filing of goods declaration. The FBR said that it had further extended the time for filing of goods declaration for all IGMs filed between April 07, 2020 to May 09, 2020 provided that this order shall not be applicable in case any fine or penalty had already been paid by the importers.

    Earlier, Khurram Ijaz, Vice President, Federation of pakistan Chambers of Commerce and Industry (FPCCI) on May 02, 2020 requested the FBR for further extension in time limit for filing of goods declaration.

    Khurram Ijaz in his communication with the FBR appriciated the revenue board for extending the time for filing of goods declaration from 10 days of arrival of goods to further 15 days (total 25 days) for all IGMDs filed between March 17, 2020 and April 07, 2020.

    However, the FPCCI vice president apprised the FBR that continued extension in lockdown by the government causing delay in timely filing of goods declaration, hence opportunity provided the revenue board should be extended up to the current lockdown till May 09, 2020.