Pkrevenue.com

Category: Supplementary Budget 2019

  • FBR outlines sales tax amendments through second supplementary finance act

    FBR outlines sales tax amendments through second supplementary finance act

    ISLAMABAD: Federal Board of Revenue (FBR) has summarized amendments to sales tax regime through Finance Supplementary (Second Amendment) Act, 2019 and directed the officials of Inland Revenue to take necessary action for implementation.

    The FBR said that to liquidate huge amount claimed by taxpayers in refunds which have been accumulated over a long time, the government has decided to pay the same through sales tax refund bonds, which shall have a maturity period of three years.

    Simple profit at 10 percent per annum is also proposed to be paid. The claimants shall also be able to raise the much needed cash by selling these notes in the security market.

    A new Section 67A has been inserted in the Sales Tax Act, 1990 to include enabling provisions for payment of refunds in this manner and also to provide for regulatory mechanism relating to issuance, transfer, redemption and other related matters.

    The FBR said that in the Sixth Schedule, the exemption of sales tax already available in relation to plant, machinery and equipment required for power generation from renewable sources of energy has been guaranteed up to June 30, 2023, to provide for certainty and confidence to investors. Same protection has been ensured on the import side of the similar equipment as covered under the Sixth Schedule.

    The FBR said that keeping in view the difficulties being faced by cancer patients and also on the orders of the Supreme Court, items related to ostomy procedures for treatment of cancer patients, which were not expressly and exhaustively mentioned in Sixth Schedule to Sales Tax Act, 1990, have now been so covered by substituting Serial Number 117 and relating it to heading 99.25 in the First Schedule to the Customs Act.

    The FBR said that presently sales tax exemption on plant and machinery is available only to specified sectors. Others sectors have to pay sales tax on import of plant and machinery.

    This sales tax is adjustable against future output tax but such adjustment takes place after a long time when the industry starts selling its product. This serves as an impediment to investment by increasing initial costs.

    In order to encourage green field investment and industrialization, exemption from payment of sales tax on imported plant and machinery to be used for setting up new industry for production of taxable goods has been provided by amending Sixth Schedule to the Sales Tax Act, 1990, as imported by the persons registered on or after 1st July, 2019 through Sr No 150 in Table 1 of Sixth Schedule to the Sales Tax Act, 1990.

    The FBR said that the new rates on the import of cellular mobile phones have been introduced by substitution in the Ninth Schedule to the Sales Tax Act, 1990.

  • FBR explains FED on motor vehicles under Second Amendment Act

    FBR explains FED on motor vehicles under Second Amendment Act

    ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday explained the amendment of Federal Excise Duty (FED) on imported and locally manufactured vehicles through Finance Supplementary (Second Amendment) Act, 2019.

    The FBR said that Serial Number of Table 1 of the First Schedule to the FED Act, 2005 had been amended and duty of the imported motor vehicles of 1800 cc to 3000cc had been enhanced to 25 percent ad valorem.

    Further, a new Serial Number 55A has been inserted whereby rate of federal excise duty has been enhanced to 30 percent ad valorem on import of motor cars, SUVs and other motor vehicles of cylinder capacity of 3000cc of above (other than those vehicles as designed for the transport of 10 or more persons.

    The FBR said that federal excise duty on locally manufactured cars SUVs etc. of engine capacity exceeding 1700CC and above at 10 percent ad valorem had also been introduced.

  • Advance tax rates enhanced by 50pc for non-filers on motor vehicle purchase

    Advance tax rates enhanced by 50pc for non-filers on motor vehicle purchase

    KARACHI: The government has allowed non-filers to purchase locally manufactured motor vehicles but at the same time the advance tax rates for non-compliant taxpayers have been increased by 50 percent.

    Federal Board of Revenue (FBR) said that the rates have been revised upward on purchase and registration of new locally manufactured cars by non-filers and these rates would be applicable from the date of approval of Finance Supplementary (Second Amendment) Act, 2019.

    Following are the rates for non-filers on purchase of motor vehicles:

    S. NoEngine capacityOld ratesNew rates
    01Up to 850ccRs10,000Rs15,000
    02851cc to 1000ccRs25,000Rs37,500
    031001cc to 1300ccRs40,000Rs60,000
    041301cc to 1600ccRs100,000Rs150,000
    051601cc to 1800ccRs150,000Rs225,000
    061801cc to 2000ccRs200,000Rs300,000
    072001cc to 2500ccRs300,000Rs450,000
    082501cc to 3000ccRs400,000Rs600,000
    09Above 3000ccRs450,000Rs675,000

     

  • Finance Supplementary (2nd Amendment) Act 2019: Directorate set up for tax recovery from undeclared offshore assets

    Finance Supplementary (2nd Amendment) Act 2019: Directorate set up for tax recovery from undeclared offshore assets

    ISLAMABAD: The federal government has set up Directorate General of International Tax Operations for recovery of tax in undeclared off-shore assets and incomes.

    According to Finance Supplementary (Second Amendment) Act, 2019, the directorate has been established under new section 230E of Income Tax Ordinance, 2001.

    The new section is as follow:

    Section 230E: Directorate General of International Tax Operations:

    Sub-Section (1): The Directorate General of International Tax Operations shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors, Assistant Directors and such other officers as the Federal Board of Revenue (FBR) may, by notification in the official Gazette, appoint.

    Sub-Section (2): The Board may, by notification in the official Gazette,-

    (a) specify the functions and jurisdiction of the Director General and its officers; and

    (b) confer the powers of authorities specified in Section 207 upon the Directorate General and its officers.

    Sub-Section (3): The functions and powers of the Directorate General of International Tax Operations shall include but not limited to –

    (a) receive and send information from other jurisdiction under spontaneous, automatic and on demand exchange of information under exchange of information agreements;

    (b) levy and recover tax by passing an assessment order under section 123(1A) in case of undeclared off-shore assets and incomes;

    (c) receive, transmit and exchange country by country reports to the jurisdictions that are parties to international agreements with Pakistan; and

    (d) conduct transfer pricing audit in cases selected for such audit by the Director General of International Tax Operations.

    Sub-Section (4): The FBR may, by notification in the official Gazette, specify the criteria for selection of the taxpayer for transfer pricing audit.

    Explanation: For the removal of doubt, it is clarified that transfer pricing audit refers to the audit for determination of transfer price at arm’s length in transactions between associates and is independent of audit under Section 177 and 214C which is audit of the income tax affairs of the taxpayer.

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  • Motor vehicle purchase restriction on non-filers withdrawn

    Motor vehicle purchase restriction on non-filers withdrawn

    ISLAMABAD: The federal government has allowed non-filers of income tax returns to purchase locally manufactured motor vehicles.

    According to Finance Supplementary (Second Amendment) Act, 2019, the government lifted the mandatory condition of return filing for purchase of motor car.

    Further through the Act, non-resident Pakistani citizens holding international passport have also been allowed to registered imported or locally manufactured cars.

    “227C. Restriction on purchase of certain assets

    Notwithstanding anything contained in any law, for the time being in force,—

    (a) any application for booking, registration or purchase of a new locally manufactured motor vehicle or for first registration of an imported vehicle shall not be accepted or processed by any vehicle registering authority of Excise and Taxation Department or a manufacturer of a motor vehicle respectively, unless the person is a filer.; and

    (b) any application or request by a person to any authority responsible for registering, recording or attesting transfer of any immovable property, exceeding five million rupees, for registering or attesting the transfer shall not be accepted or processed by such authority, unless the person is a filer:

    “Provided that the provisions of clause (a) shall not apply in respect of,─

    (i) locally manufactured motor vehicle; or

    (ii) a person holding a Pakistan origin card or a national identity card for overseas Pakistanis or a non-resident Pakistani citizen holding international passport who produces a certificate from a scheduled bank of receipt of foreign exchange remitted from outside Pakistan through normal banking channels during a period of sixty days prior to the date of booking, registration or purchase of motor vehicle:

    Provided further that the provisions of clause (b) shall not apply to,─

    (i) a legal heir acquiring property in inheritance; or

    (ii) a person holding a Pakistan origin card or a national identity card for overseas Pakistanis or a non-resident Pakistani citizen holding international passport who produces a certificate from a scheduled bank for receipt of foreign exchange remitted from outside Pakistan through normal banking channels during a period of sixty days prior to the date of registering, recording or attesting transfer.”

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  • FBR to issue sales, income tax refund bonds

    FBR to issue sales, income tax refund bonds

    ISLAMABAD: Federal Board of Revenue (FBR) will issue sales tax and income tax refund bonds through its subsidiary company ‘FBR Refund Settlement Company (Private) Limited.

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  • Non-filers allowed locally assembled motor vehicle of any engine capacity

    Non-filers allowed locally assembled motor vehicle of any engine capacity

    ISLAMABAD: The federal government has allowed non-filers of income tax returns to purchase of locally assembled motor vehicles of any engine capacity.

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  • Bill focuses very low on revenue collection: former FBR Member

    Bill focuses very low on revenue collection: former FBR Member

    KARACHI: The Finance Supplementary (Second Amendment) Bill, 2019, presented by the PTI government, is perceived to have a nominal impact on revenue collection, with a predominant focus on stimulating industrial growth.

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  • Bill to further empower FBR to tighten noose around undisclosed offshore assets

    Bill to further empower FBR to tighten noose around undisclosed offshore assets

    ISLAMABAD – The Federal Board of Revenue (FBR) has announced a significant move to enhance its authority in dealing with undisclosed offshore assets, as outlined in the proposals of the Finance Supplementary (Second Amendment) Bill, 2019.

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  • Finance Supplementary (Second Amendment) Bill 2019: Key points of income tax proposals

    Finance Supplementary (Second Amendment) Bill 2019: Key points of income tax proposals

    KARACHI: A chartered accountant firm has highlighted proposed amendments to Income Tax Ordinance, 2001 through Finance Supplementary (Second Amendment) Bill, 2019.

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