Pkrevenue.com

Category: Budget

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

  • Finance Bill 2019: reduced duty rates proposed for various imported goods

    Finance Bill 2019: reduced duty rates proposed for various imported goods

    KARACHI: The government has announced reduction in customs duty on import of various goods.

    The reduction in duty has been proposed through Finance Bill 2019.

    According to A F Ferguson & Co. Chartered Accountants Firm, by virtue of amendment in First Schedule and Fifth Schedule, reduction in customs duty has been proposed for the following items:

    Acetic acids from 16 percent to 11 percent

    Oxalic acid from 11 percent to 3 percent

    Sheets of veneering from 11 percent to 3 percent

    Fibreboard of wood of certain specifications from 16 percent to 11 percent

    Fabric (non-woven) from 16 percent to 11 percent

    Aluminium cans from 20 percent to 11 percent

    Chemicals used in leather or like industries from 20 percent /16 percent to 16 percent /11 percent

    Insulation tape double sided from 11 percent to zero percent

    Shoe lasts from 20 percent to 16 percent

    Other articles of Vulcanised rubber 20 percent to 5 percent

    Graphite or other carbon or mixture of these products 11 percent to 3 percent

    Other refractory ceramic goods from 11 percent to 3 percent

    Other Electric motors and generators from 20 percent to 16 percent

    Other automatic regulating and controlling instruments from 20 percent to 16 percent

    Multi-ply (clay coated paper and paper board) and aluminium foil from 18 percent to 15 percent

    Coils of aluminium alloys from 8 percent to 5 percent

    Pre-fabricated room/structures for setting up new hotels/motels in Hill Stations, Gilgit-Baltistan, AJK, and Coastal Areas of Baluchistan from 11 percent to 8 percent

    (ii) Following new concessions have been proposed under the Fifth Schedule:

    – Laser transmitter, laser receiver, control box, rigid mast pack, with or without scraper at concessional rate of 2 percent

    – Plant and Machinery by developers, contractors and service companies involved in infrastructure development of Large Diameter Gas Pipelines(i.e. 24” and above) projects at concessional rate of 10 percent to 0 percent subject to certain conditions

    – Aluminium sheets and coils and aluminium foil, AKD wax and dispersing agents at concessional rate of 5 percent

    – Imports by manufacturer of infant formula milk registered under Sales Tax Act, 1990 at concessional rate of 5 percent

    – Import of Exposide resin, if imported by manufacturer of powder coatings registered under Sales Tax Act, 1990 and subject to annual quota by IOCO at concessional rate of 10 percent

    – Polymers of ethylene and other plastic raw materials on import by manufacturers of diapers and sanitary napkins registered under Sales Tax Act, 1990 at concessional rates of 16 percent to 5 percent

    – Import of carbon steel strip imported by manufacturer of shaving bladed/razors registered under Sales Tax Act, 1990 at concessional rate of 5 percent

    – Import of CNG vehicle conversion kits approved by OGRA imported by authorized dealers at concessional rate of 5 percent

    (iii) Following amendments for availing concessions earlier granted have been proposed for the following sectors:

    Sector Particulars

    Agriculture Sector

    Certain conditions for availing the concession on import of agricultural machinery have now proposed to be waived off

    Power transmission and grid stations

    An additional condition has been proposed for availing concessional duty on import of machinery and equipment meant for power transmission and grid stations. The goods shall not be sold without prior approval of the FBR.

    Marble, granite and gem stone extraction and processing industries

    Additional condition for the concessional rate on machinery and equipment is proposed to be added with respect to disposal of the imported machinery.

  • Finance Bill 2019: duty exemptions on various imported goods proposed

    Finance Bill 2019: duty exemptions on various imported goods proposed

    KARACHI: The government has proposed exemptions from customs duty on import of various goods through Finance Bill 2019.

    According to A. F. Ferguson & Co. Chartered Accountants Firm the Finance Bill 2019 has proposed exemption from customs duty is proposed on following items:

    – Various industrial inputs / raw materials

    – Pharmaceutical products

    – Plastic film medical grade

    – Fertilizers

    – Plant and machinery for setting up Hydrocracker plants for oil refining

    – Raw skins and hides

    – Machinery parts and items relating to textile industry

    – Solar air water generator

    – Raw material for paper industry

    – Wood

    – Certain raw materials used in manufacture of home appliances subject to certain conditions

    – Raw material and components for local manufacture of Hemodialyzer, used in hydrolysis equipment by kidney failure patients

  • Finance Bill, 2019: 10 years imprisonment for money laundering through foreign trade

    Finance Bill, 2019: 10 years imprisonment for money laundering through foreign trade

    KARACHI: In a determined effort to combat money laundering through foreign trade, the government has unveiled strict measures, including up to 10 years imprisonment for offenders and the confiscation of implicated consignments. These proposed reforms are detailed in the Finance Bill 2019, aiming to amend the Customs Act, 1969.

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  • Customs law amended to recover unpaid amount from exporters

    Customs law amended to recover unpaid amount from exporters

    KARACHI: The government has put a check on exporters related to unpaid amount of duty and taxes at the time of export clearance and amended law to recover the same.

    Through Finance Bill 2019, it is proposed to amend Section 32(3)(A) of Customs Act, 1969 to apply this check on exporters.

    Sub-section (3A) of Section 32 deals with the issuance of show cause notice in the situation where any duty, taxes or charge has not been levied, short-levied or erroneously refunded, discovered as a result of an audit or examination of an importer’s accounts or by any other means.

    The Finance Bill 2019 seeks to extend the application of this section to exporters as well.

    The existing law under Section 32(3)(A) said:

    Notwithstanding anything contained in sub-section (3), where any duty, taxes or charge has not been levied or has been short-levied or has been erroneously refunded and this is discovered as a result of an audit or examination of an importer’s accounts or by any means other than an examination of the documents provided by the importer at the time the goods were imported, the person liable to pay any amount on that account shall be served with a notice within five years of the relevant date requiring him to show cause why he should not pay the amount specified in the notice:

    Provided that if the recoverable amount in a case is less than one hundred rupees, the Customs authorities shall not initiate the aforesaid action.

  • FBR empowered to impose fee, service charges under Customs laws

    FBR empowered to impose fee, service charges under Customs laws

    KARACHI: Federal Board of Revenue (FBR) has been empowered to impose service charges and date of determination of rate of import duty under Customs Act 1969.

    The Finance Bill 2019 has proposed delegation of powers from federal government to the FBR, which included: levy of fee and service charges; date of determination of rate of import duty; date of determination of rate of duty for clearance through the Customs Computerized System; and date for determination of rate of duty on goods exported.

    The bill proposed delegation powers to FBR under Section 18D, 30, 30A and 31 of Customs Act, 1969.

    Presently Section 18D of Customs Act, 1969 states:

    18D. Levy of fee and service charges.- The Federal Government may, by notification in the official Gazette, subject to such conditions, limitations or restrictions as it may deem fit to impose, levy fee and service charges for examination, scanning, inspections, sealing and desealing, valuation check or in respect of any other service or control mechanism provided by any formation under the control of the Board, including ventures of public-private partnership, at such rates as may be specified in the notification.

    Presently Section 30 of Customs Act, 1969 states:

    30. Date of determination of rate of import duty.- The rate of duty applicable to any imported goods shall be the rate of duty in force;

    (a) in the case of goods cleared for home consumption under section 79, on the date on which a goods declaration is manifested under that section; and

    (b) in the case of goods cleared from a warehouse under section 104, on the date on which a goods declaration for clearance of such goods is manifested under that section:

    Provided that, where a goods declaration has been manifested in advance of the arrival of the conveyance by which the goods have been imported, the relevant date for the purposes of this section shall be the date on which the manifest of the conveyance is delivered at the port of first entry:

    Provided further that, in respect of goods for the clearance of which a goods declaration for clearance has been manifested under section 104, and the duty is not paid within seven days of the goods declaration being manifested, the rate of duty applicable shall be the rate of duty on the date on which the duty is actually paid:

    Provided further that in case of the goods illegally removed from the warehouse, the rate of duty shall be the rate prevalent either on the date of in-bonding or detection of case or date of payment of the duty and taxes, whichever is higher:

    Provided further that in case of exercising option for redemption of fine in lieu of confiscation of the goods seized during anti-smuggling operations, the rate of duty shall be the rate prevalent either on the date of seizure or date of payment of duty and taxes, whichever is higher:

    Provided further that the Federal Government may, by notification in the official Gazette, for any goods or class of goods, specify any other date for the determination of rate of duty.

    Explanation:- For the purpose of this section “manifested” means that when a machine number is allocated to goods declaration and is registered in Customs record.

    Presently Section 30A of Customs Act, 1969 states:

    30A. Date of determination of rate of duty for clearance through the Customs Computerized System.- Subject to the provisions of section 155A, the rate of duty applicable to any imported or exported goods if cleared through the Customs Computerized System, shall be the rate of duty in force on;-

    (a) the date of payment of duty;

    (b) in case the goods are not chargeable to duty, the date on which the goods declaration is filed with Customs.

    Provided that where a goods declaration has been filed in advance of the arrival of the conveyance by which the goods have been imported, the relevant date for the purposes of this section shall be the date on which the manifest of the conveyance is filed at the customs-station of first entry:

    Provided further that the Federal Government may, by notification in the official Gazette, specify any other date for the determination of rate of duty in respect of any goods or class of goods.

    Presently Section 31 of Customs Act, 1969 states:

    31. Date for determination of rate of duty on goods exported.- The rate and amount of duty applicable to any goods exported shall be the rate and amount chargeable at the time of the delivery of the goods declaration under section 131:

    Provided that where the export of any goods is permitted without a goods declaration or in anticipation of the delivery of such a declaration, the rate and amount of duty applicable shall be the rate and amount chargeable on the date on which loading of the goods on the outgoing conveyance commences:

    Provided further that the Federal Government may, by notification in the official Gazette, for any goods or class of goods, specify any other date for determination of the rate of duty.

  • Collectors’ power to determine customs values withdrawn

    Collectors’ power to determine customs values withdrawn

    KARACHI: The government has withdrawn the power of Collector of Customs in determination of customs value on his own motion through Finance Bill 2019.

    The Finance Bill 2019 proposed to withdraw the powers of the collector of customs to determine customs valuations on his motion under Section 25A(1) and Section 25A(3) of Customs Act, 1969.

    The collector of customs presently has powers to determine the customs values under Section 25A.

    The sub-section 1 of Section 25A states: Notwithstanding the provisions contained in section 25, the Collector of Customs on his own motion, or the Director of Customs Valuation on his own motion or on a reference made to him by any person or an officer of Customs, may determine the customs value of any goods or category of goods imported into or exported out of Pakistan, after following the methods laid down in section 25, whichever is applicable.

    The sub-section 3 of Section 25A states: In case of any conflict in the customs value determined under sub-section (1), the Director-General of Customs Valuation shall determine the applicable customs value.

    The powers of determining customs values have now been proposed to be available with Director of Customs Valuation.

    Analysts said that this proposal in the Finance Bill 2019 would provide relief to import in clearance of consignments. They said that many arbitrary decisions of Collector have created hassles for the importers in the past and consignments were stuck up for a long time.

  • Non-ATL persons to pay double amount of withholding tax on prize bond winning

    Non-ATL persons to pay double amount of withholding tax on prize bond winning

    ISLAMABAD: The government has increased withholding tax by 100 percent on winning of prize bonds for persons not on Active Taxpayers List (ATL).

    Through Finance Bill 2019 the government has deleted the term ‘non-filers’ and imposed 100 percent withholding tax on persons not on the ATL, which contains names of persons file their returns by due date of a tax year.

    The rate of withholding tax on prize bond, cross-word puzzle and prize on winnings remains unchanged, however, the categorized rates of non-filer are proposed to be abolished.

    The amendment proposed through the Finance Bill 2019, the rate of withholding tax on winning of prize bonds and other lottery schemes shall be:

    The rate of tax to be deducted under section 156 on a prize on prize bond or cross-word puzzle shall be 15 percent of the gross amount paid.

    The rate of tax to be deducted under section 156 on winnings from a raffle, lottery, prize on winning a quiz, prize offered by a company for promotion of sale, shall be 20 percent of the gross amount paid.

    For the person winning the prize but not on the ATL shall pay double the amount as withholding tax.

  • Commissioners IR empowered to conduct audit of taxpayers every year

    Commissioners IR empowered to conduct audit of taxpayers every year

    KARACHI: Commissioners of Inland Revenue have been empowered to conduct audit of a registered taxpayer every year after removal of restriction through Finance Bill 2019.

    Through Finance Act, 2018 a restriction was imposed on offices of the Federal Board of Revenue (FBR) under which they would conduct audit of taxpayers once in every three years.

    However, the Finance Bill 2019 proposed to delete the proviso which was introduced through Finance Act last year.

    Experts at EY Ford Rhodes Chartered Accountants said that certain taxpayers challenged the audit proceedings under Section 25 where sales tax audit had already been conducted during any of the last three years on the premise that the amendment introduced through the Finance Act, 2018 was procedural change in law and was applicable retrospectively.

    Recently, the Honorable Lahore High Court has adjudged the matter in favor of the taxpayer. It appears that the proposed deletion of the third proviso to Section 25 will neutralize the judgment of the Honorable Lahore High Court.

  • Commercial importers to file income returns after removal of FTR

    Commercial importers to file income returns after removal of FTR

    ISLAMABAD: Commercial importers will require to file return of income and statement of assets to the tax authorities after the removal of final tax regime.

    Tax authorities said that the commercial importers would require to submit details of imports and source of payment for opening the letter of credit (LCs) through their returns.

    According to budget commentary by EY Ford Rhodes on Finance Bill, 2019, before the Finance Act, 2018, tax required to be collected under Section 148 on import of plastic raw material imported by an industrial undertaking, falling under PCT headings 39.01 to 39.12, edible oils and packing material is treated as minimum tax.

    Furthermore, tax required to be collected on import of goods that are sold in the same condition as they were when imported was treated as final tax.

    The Finance Act, 2018 brought a substantive conceptual shift with respect to taxation of commercial importers whereby such tax collection was deemed to be “minimum tax” in respect of such importers.

    Due to the aforesaid change in taxability of commercial importers, there were grave concerns shown by the above sector, as this change would have required the commercial importers to declare the financial results for comparison of tax on profits to the minimum tax on imports.

    As a result of strong lobbying by commercial importers, amendments were made in Section 148 through the Finance Supplementary (Second Amendment) Act, 2019 whereby tax collected at import stage from commercial importers was again treated as final discharge of tax liability of such importers.

    “The Finance Bill 2019 now proposes to restore the position as stood after the amendments made through the Finance Act, 2018 to change the character of such tax collection from “final tax” to “minimum tax”.

    “Such commercial importers, pursuant to the proposed amendments will now be required to file a return of income instead of filing a statement in terms of Section 115 of the Ordinance.”

    The Bill also proposes amendments in Sub-section (8A) of Section 148 whereby tax collected at the time of import of ships by ship-breakers is also to be treated as ‘minimum tax’.

  • Karachi Chamber highlights budget anomalies, urges rectification

    Karachi Chamber highlights budget anomalies, urges rectification

    KARACHI: President Karachi Chamber of Commerce & Industry (KCCI) Junaid Esmail Makda, while highlighting various Sales Tax and Income Tax anomalies unveiled in the Federal Budget 2019-2020, appealed Prime Minister Imran Khan, State Minister for Revenue Hammad Azhar and Chairman FBR Shabbar Zaidi to rectify all these anomalies on top priority prior to seeking approval of the Budget from the parliament.

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