Pkrevenue.com

Category: Budget

This is parent category of budgets presented by Pakistan government. Here you will find year-wise federal and provincial budgets.

  • Caffeinated energy drinks are health hazard; FED enhanced to 25pc

    Caffeinated energy drinks are health hazard; FED enhanced to 25pc

    ISLAMABAD: The federal government has increased federal excise duty from 13 percent to 25 percent on consumption o f caffeinated energy drinks on both local supplies and import of such drinks.

    Hammad Azhar, Federal Minister for Industry and Production, while presenting the federal budget 2020/2021 on June 12 on floor of the house said that caffeinated energy drinks are health hazard, hence to reduce the consumption of such drinks it is proposed that the FED may be increased from 13 percent to 25 percent both at import and at local supply.

    It may be noted that aerated waters are already subject to FED at 13 percent.

    Further, FED on imported cigarettes, cheroots, cigarillos, cigars and other tobacco substitutes is being enhanced from 65 percent to 100 percent in line with WHO (World Health Organization) standards.

    Necessary changes are also proposed to be made in Table 1 of the First Schedule pertaining to aforesaid items to cover for tobacco substitutes as well as E-cigarettes, the minister said.

    Filter rod is a basic input material for cigarette manufacturing. Present rate of FED is Rs.0.75 per filter rod. To enhance the effect of monitoring and enforcement on tobacco consumption and tax management, it is proposed that the existing rate be enhanced to Rs.1 per filter rod.

    FED structure is already in place for both local and imported motor cars and SUVs excluding auto rickshaw falling under the PCT heading 87.03.

    Double cabin pick up which is currently classified as goods transport vehicle is being reclassified as passenger transport vehicle, which will bring it in the ambit of FED at 7.5 percent ad valorem in case of locally manufactured vehicles and at 25 percent in the case of imported ones.

    Sales tax is charged on standard rate of 17 percent on import and local supply of Potassium Chlorate and in addition to that Rs 70 per kg is also collected. On the recommendation of the Match manufacturers association the rate of Rs. 70 per kg is being enhanced to Rs. 80 per kg. Provided that rate of rupees 70/80 per kilogram is not applicable on imports made by and supplies made to organizations under the control of Ministry of Defense Production.

  • CGT on immovable properties reduced by 50 percent

    CGT on immovable properties reduced by 50 percent

    ISLAMABAD: The capital gain tax on (CGT) disposal of immovable properties has been reduced by 50 percent in order to promote investment in construction industry.

    According to Deloitte Yousuf Adil, Chartered Accountants, the Finance Bill 2020 proposed reduction in tax rates by 50 percent on capital gains arising on disposal of immovable property.

    This is in line with the Government’s vision to promote construction industry and to provide stimulus for the growth in economy as construction sector provide employment to a number of sub-sectors.

    S. No.Amount of gainRate of tax
      ExistingProposed
    1.Where the gain does not exceed Rs.5 million5%2.5%
    2.Where the gain exceeds Rs.5 million but does not exceed Rs.10 million10%5%
    3.Where the gain exceeds Rs.10 million but does not exceed Rs.15 million15%7.5%
    4.Where the gain exceeds Rs.15 million20%10%

    A person responsible for registering, recording, or attesting transfer of immovable property is required to collect advance tax from seller of such property.

    Such advance tax is not collected where the immovable property is held for a period exceeding 5 years.

    The Bill proposes to reduce this time limit of 5 years to 4 years.

  • Automated scrutiny of tax returns to end universal self assessment scheme

    Automated scrutiny of tax returns to end universal self assessment scheme

    The Federal Board of Revenue (FBR) has introduced a significant policy shift through the Finance Bill 2020, proposing the automated scrutiny of all income tax returns, which may signal the end of the Universal Self-Assessment Scheme (USAS) in Pakistan.

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  • Highlights of tax relief announced by Khyber Pakhtunkhwa for 2020/2021

    Highlights of tax relief announced by Khyber Pakhtunkhwa for 2020/2021

    PESHAWAR: The Khyber Pakhtunkhwa government announced tax relief package in order to mitigate the adverse impact of coronavirus.

    Key points of the tax incentives to be granted during the next fiscal year.

    i. Sales tax on services (STS) will be reduced for over 27 categories. This will be an allencompassing reduction for sectors where the economic activity has dampened and directly impacted cash flow and liquidity. These sectors include business support services, construction sector, oil and gas exploratory services, hospitality sector, bargain centers etc.

    ii. Entertainment and Hotel Tax will be removed from Excise and Taxation department’s portfolio, to encourage recreation and entertainment during these testing times for the economy.

    iii. Professional Tax will be phased out to Khyber Pakhtunkhwa Revenue Authority dovetailed with tax breaks and concessions for a year to remove duplicity of taxes and provide relief for more than 15 professions involved including Doctors, Lawyers, Retailers etc.

    iv. To promote and incentivize the tourism sector, a special concession will be introduced for the hotels and restaurants located in hilly areas. Coupled with a reduced rate, a clause of tax hypothecation will be included to ensure that the tax collected from this sector is invested into the same regions’ growth and prosperity.

    v. Rates for the Urban Immovable Property Tax will be rationalized, and compliant taxpayers will be offered a rebate of 35%. This is directly intended to promote compliance, provide direct relief, encourage construction and comfort the taxpayers during this economic slump.

    vi. Urban Immovable Property Tax under the Excise and Taxation Department will be introducing special discounts or pending arrears. Under this scheme, special concessions will be introduced for those who volunteer to clear arrears, intention is to lend a helping hand to the construction sector during this liquidity crises.

    vii. Board of Revenue will reduce both Capital Value Tax and Stamp duty for the construction sector, under the Federal Amnesty Scheme. This concession will be amalgamated with a complete digitization of the system with reduced discrepancies.

  • Khyber Pakhtunkhwa presents Rs923 billion tax free budget for 2020/2021

    Khyber Pakhtunkhwa presents Rs923 billion tax free budget for 2020/2021

    PESHAWAR: The Khyber Pakhtunkhwa Government on Friday presented budget 2020/2021 with total outlay of Rs 923billion. The budget is a tax free and with an amount of Rs104 billion allocated for Annual Development Plan (ADP) for the next fiscal year.

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  • KCCI submits recommendations to rectify anomalies in Finance Bill 2020

    KCCI submits recommendations to rectify anomalies in Finance Bill 2020

    KARACHI: The Karachi Chamber of Commerce and Industry (KCCI) has submitted its recommendations to rectify anomalies in the Finance Bill 2020, highlighting concerns over several taxation measures impacting trade and industry.

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  • Reduction in rental income expense limit to encourage under-reporting

    Reduction in rental income expense limit to encourage under-reporting

    Presently, expenses incurred to the extent of 6 percent of rent chargeable wholly and exclusively for deriving rent are admissible as deduction against rental income.

    The Bill proposed to reduce the limit from 6 percent to 2 percent.

    The experts said that further reducing such limit would deprive a taxpayer for claiming a legitimate expense incurred solely for deriving taxable income and would ultimately lead to higher tax payable by the taxpayer. “It may encourage taxpayers to under-report their taxable income on the grounds that their legitimate expenses are disallowed,” experts at Deloitte Yousuf Adil Chartered Accountants said.

    Presently, income from property derived by an individual or an Association of Persons is subject to tax at the specified slab rates and treated as a separate block of income.

    However, individuals or AOPs whose income from property exceeds Rs 4 million per annum can opt to claim deductions under section 15A of the Ordinance and pay tax at normal rates specified in Division I of Part I of the First Schedule.

    The Bill proposed to abolish such limit of Rs. 4 million and therefore an individual or AOP can now opt for claiming tax deductions and pay tax at normal rates irrespective of amount of income derived from property.

  • PRA empowered to arrest tax defaulters, imprison for six months

    PRA empowered to arrest tax defaulters, imprison for six months

    LAHORE: Punjab Revenue Authority (PRA) has been empowered to arrest defaulters and imprison for six months for making recovery of outstanding tax.

    The Punjab Finance Bill, 2020 has proposed to empower PRA in certain provisions of Punjab Sales Tax Act, 2012 for making recovery of outstanding tax.

    According to interpretation of Punjab Finance Bill, 2020 by PwC A. F. Ferguson, the bill proposes to empower tax authorities whereby they may also require a financial institution or banking company to make payment of tax due from a registered person out of running and demand finance extended to the registered person.

    By way of insertion of clause (g) to section 70 of the Act, it also empowers the department to arrest a defaulter and imprison him for not more than six months where a tax demand has been upheld by the Appellate Tribunal.

    No action is presently taken where a person deposits at least 25 percent of the tax demand during pendency of an appeal. It is proposed to reduce this limit to 10 percent of the tax demand. This is a positive amendment.

    The amendments relating to administrative and procedural matters are summarized as under:

    — The power of the PRA to de-register a person is proposed to be devolved to the Commissioner.

    — The PRA is being authorized to specify format of invoices to be issued by a registered person or class of registered persons and to prescribe a procedure for authentication of such invoices.

    — The PRA or authorized officer may require any registered person or class of registered persons to issue invoices electronically and transmit such invoices to PRA in the prescribed manner.

    — To streamline audit proceedings, it is proposed to empower officers to conduct audit proceedings electronically through video links or any other facility as may be notified by PRA.

    — It is proposed to empower even officers, below the rank of an Assistant Commissioner, to call for information or documents regarding any enquiry or audit.

    Earlier, only an Assistant Commissioners or Officers with higher ranks may call for such information.

    — To facilitate taxpayers, it is proposed that appeal before the Commissioner (Appeals) may also be filed through electronically.

    — The period of filing an appeal before the appellate tribunal is proposed to enhance from 30 days to 60 days.

  • Punjab enlists records to be maintained by taxpayers

    Punjab enlists records to be maintained by taxpayers

    LAHORE: The service providers falling under the jurisdiction of Punjab Revenue Authority (PRA) are required to maintain records enlisted through provincial Finance Bill, 2020.

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  • Sindh Budget 2020-2021 at a glance

    Sindh Budget 2020-2021 at a glance

    KARACHI: The Sindh government on Wednesday presented budget for fiscal year 2020/2021. The following is budget at a glance: