Pkrevenue.com

Author: Faisal Shahnawaz

  • Sales Tax Act, 1990: FBR may posts IR officer to business premises

    Sales Tax Act, 1990: FBR may posts IR officer to business premises

    KARACHI: Federal Board of Revenue (FBR) may post an officer of Inland Revenue to the premises of a registered taxpayer to monitor sale, purchase and production activities.

    The Section 40 of updated Sales Tax Act, 1990 explained the powers of FBR and Inland Revenue officers under the law.

    Section 40: Searches under warrant

    Sub-Section (1): Where any officer of Inland Revenue has reason to believe that any documents or things which in his opinion, may be useful for, or relevant to, any proceedings under this Act are kept in any place, he may after obtaining a warrant from the magistrate, enter that place and cause a search to be made at any time.

    2) The search made in his presence under sub-section (1) shall be carried out in accordance with the relevant provisions of the Code of Criminal Procedure, 1898 (V of 1898).

    Section 40B: Posting of Inland Revenue Officer

    Subject to such conditions and restrictions, as deemed fit to impose, the Board, may post Officer of Inland Revenue to the premises of registered person or class of such persons to monitor production, sale of taxable goods and the stock position.

    Section 40C: Monitoring or Tracking by Electronic or other means

    Sub-Section (1): Subject to such conditions, restrictions, and procedures, as it may being fit to impose or specified, the Board may, by notification in the official Gazette, specify any registered person or class of registered persons or any good or class of goods in respect of which monitoring or tracking of production, sales, clearances, stocks or any other related activity may be implemented through electronic or other means as may be prescribed.

    Sub-Section(2): From such date as may be prescribed by the Board, no taxable goods shall be removed or sold by the manufacturer or any other person without affixing tax stamp, bandrole stickers, labels, barcodes, etc. in any such form, style and manner as may be prescribed by the Board in this behalf.

    Sub-Section (3): Such tax stamps, banderols, stickers, labels, barcodes etc., shall be acquired by the registered person referred to in sub-section (2) from a licensee appointed by the Board for the purpose, against price approved by the Board, which shall include the cost of equipment installed by such licensee in the premises of the said registered person.

  • Sindh receives Rs441.8 billion in nine months: finance ministry

    Sindh receives Rs441.8 billion in nine months: finance ministry

    ISLAMABAD: The ministry of finance on Monday said that Sindh has received Rs441.8 billion during the first nine months of current fiscal year.

    While clarifying media reports that the federal government had delayed or reduced transfers of funds to provinces, said that the government of Sindh has received Rs441.8 billion, as federal transfers, during the first three quarters (July – March 2018–19) of the current fiscal year compared to Rs418.1 billion during the corresponding period of the last fiscal year entailing a 5.7 percent increase i.e. Rs23.7 billion higher than the last year.

    Similarly, Punjab and Khyber Pakhtunkhwa have received Rs 866.6 billion and Rs. 290.4 billion, respectively, compared to Rs 801.7 billion and Rs 269.3 billion received during the corresponding period last year that has resulted in 8.1 percent and 7.9 percent increase in their Federal transfers.

    Balochistan also saw a12.8 percent increase in its Federal Transfers by receiving Rs. 180.3 billion compared to Rs. 159.9 billion during the same corresponding period.

    The ministry said that all the provinces have been receiving their share in the Federal Transfers in accordance with the NFC Award.

    The Federal Government makes these transfers, fortnightly, on the same day of reporting of the collections by the collecting agencies (i.e. Federal Board of Revenue and Petroleum Division).

    Any shortfall in revenue collections results in a uniform change in the share of the Federation and the provinces in the Federal Transfers.

  • SRB extends return filing date for telecom service providers

    SRB extends return filing date for telecom service providers

    KARACHI: The Sindh Revenue Board (SRB) has announced an extension for the filing of returns. The revised deadline, now set for May 3, 2019, pertains specifically to the tax period of March 2019.

    (more…)
  • Equity market ends down by 104 points on panic selling

    Equity market ends down by 104 points on panic selling

    KARACHI: The equity market ended down by 104 points on Monday owing to panic selling.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 37,026 points as against 37,130 points showing a decline of 104 points.

    Analysts at Arif Habib Limited said that the market commenced on a positive note today and continued the rally that took place last week.

    During the session, the index increased by 307 points that was caused by Cement sector stocks hitting upper circuit.

    However, rumor regarding failure of negotiation amongst Cement manufacturers caused panic selling by investors, which resulted in index sliding in negative territory and erosion of price gains made earlier.

    Cement Sector topped the volumes with 34 million shares, followed by Banks (24 million).

    Among scrips, PIBTL led the volumes with 14 million shares followed by PAEL (11 million).

    Major sentiment dampener turned out to be E&P sector that saw heavy selling in all the E&P scrips on the back of falling international oil prices.

    Sectors contributing to the performance include Transport (+20 points), Tobacco (+19 points), E&P (-100 points), Fertilizer (-43 points), Power (-9 points), Textile (-8 points) and Cement (-7 points).

    Volumes increased from 144 million shares to 177 million shares (+23 percent DoD).

    Average traded value also increased by 22 percent to reach US$ 44.8 million as against US$ 36.7 million.

    Stocks that contributed significantly to the volumes include PIBTL, PAEL, BOP, FCCL and KEL, which formed 32 percent of total volumes.

    Stocks that contributed positively include PIBTL (+20 points), HBL (+16 points), HMB (+10 points), PMPK (+10 points), and PAKT (+9 points). Stocks that contributed negatively include PPL (-46 points), OGDC (-34 points), POL (-23 points), ENGRO (-19 points) and LUCK (-13 points).

  • Rupee maintains level for 11th consecutive trading day

    Rupee maintains level for 11th consecutive trading day

    KARACHI: The Pak Rupee maintained level against the US dollar for the 11th consecutive trading day on Monday owing to lackluster trading activities.

    The rupee ended Rs141.40 to the dollar, same level on last Friday, in interbank foreign exchange market.

    The interbank foreign exchange market was initiated in the range of Rs141.39 and Rs141.40.

    The market recorded day high of Rs141.40 and low of Rs141.3950 and closed at Rs141.40.

    The exchange rate in open market ended with 10 paisa depreciation in rupee value.

    The buying and selling of dollar was recorded at Rs141.80/ Rs142.20 from last Saturday’s closing of Rs141.70/Rs142.20 in cash ready market.

  • FBR IR offices to remain open till 8:00pm on April 30 to facilitate return filing

    FBR IR offices to remain open till 8:00pm on April 30 to facilitate return filing

    ISLAMABAD: Federal Board of Revenue (FBR) on Monday directed the offices of Inland Revenue to observe extended working hours to facilitate taxpayers for filing their income tax returns and payment of duty and taxes.

    As per the FBR directives the Inland Revenue offices, including Large Taxpayers Units (LTUs), Regional Tax Offices (RTOs) and Corporate Regional Tax Offices (CRTOs) would remain open till 8:00 PM on April 30, 2019 to facilitate the taxpayers in payment of duties and taxes besides facilitating the filing of income tax returns/statements.

    The FBR instructed the Chief Commissioners of Inland Revenue to establish liaison with State Bank of Pakistan (SBP) and authorized branches of National Bank of Pakistan (NBP) to ensure transfer of tax collection by these branches on April 30, 2019 to the respective branches of the SBP on the same date so as to account for the same towards the collection for the month.

  • April 30 last day for filing annual return; eyes on amnesty scheme for further extension

    April 30 last day for filing annual return; eyes on amnesty scheme for further extension

    ISLAMABAD: Tomorrow April 30, 2019 is the last day for filing income tax return for Tax Year 2018, which was extended many times since the actual filing date.

    Sources in on Monday said that the Federal Board of Revenue (FBR) may further extend the last date for filing income tax returns with the launch of proposed tax amnesty scheme.

    Previously the FBR on March 31, 2019 extended the last date for filing income tax returns by month up to April 30 through Circular No. 03/2019.

    It was second extension, when the FBR on March 15 extended the date for filing income tax returns up to March 31, 2019.

    The salary persons are required to file their annual returns by August 31 and business individuals and companies having special year required to file returns by September 30. Companies having normal tax year (July – June) are required to file annual return by December 31.

    For tax year 2018 the FBR previously extended the last date for filing income tax returns up to December 15, 2018 in case of salary individuals, business individuals, FTR taxpayers and companies having special tax year.

    Through Finance Act, 2018 a new section 182A was inducted to Income Tax Ordinance, 2001 under which the taxpayers who filed their annual returns after due date were disqualified to appear on Active Taxpayers List (ATL). The ATL is an important document to avail the benefits of reduced rate of withholding taxes. The restriction was also disabled the late return filers to avail advantage in purchasing motor vehicles and immovable properties.

    This restriction also reduced the number of return files massively by due date ended in December 2018. The FBR received income tax returns around 1.59 million as per new ATL for tax year 2018 issued on March 01, 2019. The FBR received 1.84 million returns up to February 28, 2019 for tax year 2017.

    Stakeholders have demanded the FBR to find out way for including late filers into ATL and increase the number of returns.

    Following the extension the date for filing returns on March 15, 2019 the FBR has received over 1.9 million returns for tax year 2018 up to April 15, 2019.

  • Withholding tax card for dividend income, return on Sukuk: updated for Tax Year 2019

    Withholding tax card for dividend income, return on Sukuk: updated for Tax Year 2019

    KARACHI: Federal Board of Revenue (FBR) has updated withholding tax card for Tax Year 2019 incorporating amendment made to Income Tax Ordinance, 2001 through Finance Supplementary (Second Amendment) Act, 2001.

    Following are the withholding tax rates for dividend income and return on investment in Sukuk under Section 150 and Section 150 A updated up to March 09, 2019 for Tax Year 2019.

    Every persons paying dividend under Section 150 of Income Tax Ordinance, 2001 shall deduct withholding tax on the gross amount of dividend paid to the recipient at the following rates:

    a. Purchaser of Wapda privatized power project, company setups for power generation or company supplying coal exclusively to power generation projects: 7.50 percent

    b. the tax rate for filer (other than mentioned in (a) above): 15 percent

    c. non-filers (other than mentioned in (a) above): 15 percent

    i. in the case of collective investment scheme, REIT scheme or mutual funds, rate of tax on dividend paid shall be:

    Stock Fund: Individual 12.50 percent; company 12.5 percent; Association of Person (AOP) 12.5 percent.

    Money market Fund, Income Fund, or , REIT scheme or any other fund:

    Individual: filer 12.5 percent; non-filer 15 percent

    Company: filer 15 percent; non-filer 25 percent

    AOP: filer 12.5 percent; non-filer 15 percent

    ii. In case of Stock Fund if dividend recipient gain, the rate of tax shall be: 12.5 percent

    iii. In the case of Money Market Mutual Fund, the rate of tax on dividend paid up to Rs2.5 million, to a person (i.e. individual and AOP) other than company, shall be: 10 percent

    iv. In the case of Rental REIT, the rate of tax on dividend paid to an Individual shall be: 7.5 percent

    The withholding tax for return on investment in Sukuk under Section 150A shall be deducted by special purpose vehicle, company from Sukuk holders on payment of gross amount on return on investment.

    The withholding tax rates will be:

    a) In case the Sukuk- holder is a company: 15 percent

    b) In case the Sukuk – holder is an individual or an association of person, if the return on investment is more than one million: 12.50 percent

    c) In case the Sukuk – holder is an individual and an association of person, if the return on investment is less than one million, 10 percent, and

    d) In case the Sukuk – holder is a non-filer: 17.50 percent

  • Sales Tax Act 1990: IR officers empowered with free access to enter business premises

    Sales Tax Act 1990: IR officers empowered with free access to enter business premises

    KARACHI: Authorized officers of Inland Revenue have access to business premises of sales tax registered taxpayers to inspect record of sales and purchases.

    According to Section 38 of updated Sales Tax Act, 1990 issued by Federal Board of Revenue (FBR), explained the powers of authorized officers of Inland Revenue to enter business premises for inspecting records.

    Section 38: Authorized officers to have access to premises, stocks, accounts and records

    Sub-Section (1): Any officer authorized in this behalf by the Board or the Commissioner shall have free access to business or manufacturing premises, registered office or any other place where any stocks, business records or documents required under this Act are kept or maintained belonging to any registered person or a person liable for registration or whose business activities are covered under this Act or who may be required for any inquiry or investigation in any tax fraud committed by him or his agent or any other person; and such officer may, at any time, inspect the goods, stocks, records, data, documents, correspondence, accounts and statements, utility bills, bank statements, information regarding nature and sources of funds or assets with which his business is financed, and any other records or documents, including those which are required under any of the Federal, Provincial or local laws maintained in any form or mode and may take into his custody such records, statements, diskettes, documents or any part thereof, in original or copies thereof in such form as the authorized officer may deem fit against a signed receipt.

    Sub-Section (2): The registered person, his agent or any other person specified in sub-section (1) shall be bound to answer any question or furnish such information or explanation as may be asked by the authorized officer.

    Sub-Section(3): The department of direct and indirect taxes or any other Government department, local bodies, autonomous bodies, corporations or such other institutions shall supply requisite information and render necessary assistance to the authorized officer in the course of inquiry or investigation under this section.

    Section 38A: Power to call for information

    The Commissioner may, by notice in writing, require any person, including a banking company, to furnish such information or such statement in connection with any investigation or inquiry in cases of tax fraud, as may be specified in such notice:

    Provided that the Commissioner may require any regulatory authority to provide information concerning the licenses and authorizations issued by it.

    Section 38B: Obligation to produce documents and provide information

    Sub-Section (1): Notwithstanding anything contained in this Act or any other law for the time being in force, any person required to maintain the record under the Act, on demand by an officer, not below the rank of an Assistant Commissioner Inland Revenue, by notice in writing, as and when specified in the notice, shall,–

    (a) produce for examination, such documents or records which the officer of Inland Revenue considers necessary or relevant to the audit, inquiry or investigation under the Act;

    (b) allow the officer of Inland Revenue to take extracts from or copies of such documents or records; and

    (c) appear before the officer of Inland Revenue and answer any question put to him concerning the documents and records relating to the audit or inquiry or investigation referred to in clause (a) above.

    Sub-Section (2): An officer of Inland Revenue conducting an audit, inquiry or, as the case may be, an investigation under the Act, may require in writing any person, department, company or organization to furnish such information as is held by that person, department, company or organization, which, in the opinion of the officer of Inland Revenue, is relevant to such audit, inquiry or investigation.

    Sub-Section (3): The Board may require, in writing, any person, department, company or organization, as the case may be, to provide any information or data held by that person, department, company or organization, which, in the opinion of the Board, is required for purposes of formulation of policy or administering the Customs, Sales Tax, Federal Excise or Income Tax.

    Sub-Section (4): Every person, department, company or organization shall furnish the information requisitioned by the Board or the officer of Sales Tax under sub-section (2) or (3), within the time specified in the notice issued by the Board or, as the case may be, the officer of Inland Revenue.

  • Pakistan, China agree on duty free access to 313 tariff lines

    Pakistan, China agree on duty free access to 313 tariff lines

    ISLAMABAD: Pakistan and China have signed second phase of Free Trade Agreement (FTA) under which both the countries have agreed allowing duty free access to 313 tariff lines.

    Prime Minister Imran Khan and Chinese Premier Li Keqiang witnessed the signing ceremony at a meeting on the conclusion of the 2nd Belt and Road Forum (BRF) in Beijing, a statement said on Sunday.

    Officials at the ministry of commerce said that China had agreed to grant Pakistan duty free access same as give to ASEAN countries. They said that Pakistan and China had agreed on giving duty free access to around 75 percent tariff lines.

    The officials said that Pakistan would get duty free access to 313 tariff lines. This relaxation would help Pakistan to improve exports to China by $6.5 billion during next five years.

    They said that Pakistan would able to export duty free goods including textile, leather, agriculture, chemical, engineering, plastic, furniture etc.

    According to the commerce ministry protection to local industry was given priority in signing the free trade agreement. It is also agreed to put 1,700 tariff lines from China on sensitive list.

    The officials said that China imports around $40 billion annually those items from various countries, which Pakistan export to China. The agreement would help 90 percent Pakistani products accessing Chinese markets.

    Abdul Razak Dawood, Adviser to Prime Minister on Commerce, who is also in China, said that around 400 Chinese investors attended Pak-China Business Forum and they had shown interest to enter Pakistani market.

    He said that Pakistan and China had signed free trade agreement. Besides this agreement both the countries also signed 16 Memorandum of Understandings (MoUs) including agriculture, Information Technology, Chemical etc.

    He said that the free trade agreement would attract investors into Pakistan. Further Pakistan will get same benefits under free trade agreement what ASEAN countries are availing.