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Category: Taxation

Pakistan Revenue delivers the latest taxation news, covering income tax, sales tax, and customs duty. Stay updated with insights on tax policies, regulations, and financial developments in Pakistan.

  • Property tax collection sharply rises by 214 percent

    Property tax collection sharply rises by 214 percent

    KARACHI: The collection of property tax witnessed unprecedented growth of 214 percent owing to back to back increase in valuation of immovable properties by Federal Board of Revenue (FBR), sources said.

    The quarterly data released by the finance ministry revealed that the provinces had collected property tax to the tune of Rs7.8 billion during first quarter (July – September) 2019/2020 as compared with Rs2.48 billion in the corresponding period of the last fiscal year.

    The sources attributed the significant rise in property tax to increase in FBR valuation which was introduced in August 2016 and increased by 20 percent in February 2019 and further increased with the same ratio in July 2019.

    The provinces have jurisdiction over the collection of property tax in the shape of rented properties in their respective localities.

    The sources said that with the increase of FBR valuation the provinces could able to increase their revenue because the rent agreements are being made on the basis of existing valuation.

    On the other hand the valuations of immovable properties notified by the provinces are very low comparing the open market values. However, under the proposed reform program funded by the World Bank the provinces may review their valuations of immovable properties.

    The major increase in property tax comes from Punjab as the province collected Rs6 billion during first quarter of the current fiscal year.

    It was followed by Sindh, which collected Rs1.5 billion, Khyber Pakhtoonkhwa collected Rs243 million and Balochistan collected Rs89 million.

    The sources said that digitalization of property record and effective measures of documentation would further help the provinces to increase the revenue collection under the head of property tax.

  • SRB suspends sales tax registration of rice mill

    SRB suspends sales tax registration of rice mill

    KARACHI: Sindh Revenue Board (SRB) has suspended sales tax registration of a rice mill for defaulting payment and non-compliance of return filing.

    The SRB through a notice suspended the registration of sales tax of M/s. Abdullah Lakhair Rice Mill for failure to deposit due amount of Sindh Sales Tax of Rs502,400.

    Besides, the rice mill also failed to file its monthly returns for the tax periods from August 2017 to December 2017 and from January 2019 to October 2019.

    The SRB asked the mill that the suspension of the registration would only be revoked if it ensures compliance by December 03, 2019.

    The SRB said that in case of non-satisfactory response to take remedial measures the case would be further proceeded for cancellation of registration with SRB.

  • FBR collects Rs1,617 billion in five months; shortfall increases by Rs206 billion

    FBR collects Rs1,617 billion in five months; shortfall increases by Rs206 billion

    ISLAMABAD: The shortfall in revenue collection by Federal Board of Revenue (FBR) has soared to Rs206 billion during first five months (July – November) 2019/2020 making it more difficult for revenue authorities to achieve full year target of Rs5,550 billion.

    As per the revenue collection till Friday evening, the FBR provisionally collected Rs1617 billion during July – November 2019/2020 as compared with the five – month target of Rs1,829 billion.

    The FBR sources said that the provisional figures may increase to Rs1623 billion after finalization of collection.

    However, the FBR achieved 17 percent growth in first five months by collecting Rs1617 billion when compared with Rs1383 billion in the corresponding months of the last fiscal year.

    In the month of November 2019 the FBR collected Rs334 billion, which is 18 percent higher when compared with Rs282 billion in the same month of the last year.

    The FBR also missed the monthly target for the month of November 2019, which was Rs381 billion.

    It is worth mentioning here that the collection for fiscal year 2018/2019 had posted negative growth in 51 years.

  • Customs detects fake financial instruments by importers for provisional clearance

    Customs detects fake financial instruments by importers for provisional clearance

    KARACHI: Customs authorities have foiled a bid to clear consignments by some fabric importers on basis of fake financial instruments as payment of duty and taxes.

    In a statement on Saturday, Model Customs Collectorate (MCC) Port Muhammad Bin Qasim said that importers M/s. Gravity Trading Company, M/s. Iqra Textile and M/s Voroly Impex were required to submit pay order in lieu of provisional assessment of value on the basis of Sindh High Court order dated October 31, 2019 in various petitions.

    The importers submitted 43 pay orders amounting Rs63.50 million, in the bank guarantee section of the collectorate as securities.

    The collectorate said that the importers were involved in submission of fake pay orders. The phenomenon was detected after scrutiny of the financial instruments, such as printing of same branch code pertaining to different branches of Karachi and Lahore of same bank. The bank has also confirmed the pay orders as fake.

    The illegal and fraudulent act, with the active connivance of their clearing agent M/s Kanwal Enterprises and M/s. Welcome Services constituted an offence. Accordingly the GDs of the importers have been blocked.

    The collectorate lodged FIR against the importers and their facilitators.

    The bank guarantee section has also been directed to be vigilant on submission of the securities along with verification of available and new securities, especially pay orders and bank guarantees.

  • Information of account holders to be furnished by banks under Section 165A

    Information of account holders to be furnished by banks under Section 165A

    KARACHI: Federal Board of Revenue (FBR) and banks have agreed on sharing information of financial transactions made by account holders.

    The information to be furnished by the banks was to be implemented in 2013 but due to litigation it was not enforced.

    However, on November 27, 2019 the banks, in a meeting with FBR chairman, agreed to provide information of transactions. They also agreed to withdraw cases filed against implementation of Section 165A.

    The Section 165A was introduced to Income Tax Ordinance, 2001 through Finance Act, 2013.

    165A. Furnishing of information by banks

    (1) Notwithstanding anything contained in any law for the time being in force including but not limited to the Banking Companies Ordinance, 1962 (LVII of 1962), the Protection of Economic Reforms Act, 1992 (XII of 1992), the Foreign Exchange Regulation Act, 1947 (VII of 1947) and the regulations made under the State Bank of Pakistan Act, 1956 (XXXIII of 1956), if any, on the subject every banking company shall make arrangements to provide to the Board in the prescribed form and manner,—

    (a) a list of persons containing particulars of cash withdrawals exceeding fifty thousand Rupees in a day and tax deductions thereon, aggregating to Rupees one million or more during each preceding calendar month.”

    (b) a list containing particulars of deposits aggregating rupees ten million or more made during the preceding calendar month;

    (c) a list of payments made by any person against bills raised in respect of a credit card issued to that person, aggregating to rupees two hundred thousand or more during the preceding calendar month;

    (d) a list of persons receiving profit on debt exceeding five hundred thousand rupees and tax deductions thereon during preceding financial year.

    (2) Each banking company shall also make arrangements to nominate a senior officer at the head office to coordinate with the Board for provision of any information and documents in addition to those listed in sub-section (1), as may be required by the Board.

    (3) The banking companies and their officers shall not be liable to any civil, criminal or disciplinary proceedings against them for furnishing information required under this Ordinance.

    (5) Subject to section 216, all information received under this section shall be used only for tax purposes and kept confidential.

  • PTBA asks FBR to allow amnesty declaration filing on already paid tax

    PTBA asks FBR to allow amnesty declaration filing on already paid tax

    LAHORE: Pakistan Tax Bar Association (PTBA) has said that those persons who had made payment for availing tax amnesty scheme but failed to file their returns should be given an opportunity for compliance.

    In a letter to Syed Shabbar Zaidi, Chairman, Federal Board of Revenue (FBR) on Friday, the PTBA requested for filing of declaration under Asset Declaration Act, 2019 of persons who made payment of tax prior to deadline.

    The PTBA referred to its letter sent to the chairman on September 18, 2019 on the same issue.

    The tax bar said that in this regard the desired independent legal opinion was also forwarded as given by Makhdoom Ali Khan, Senior Advocate Supreme Court of Pakistan with the previous letter.

    The legal opinion concluded as under:

    The FBR should allow the taxpayers to file their declaration after July 03, 2019 considering –

    That the scheme of the Act 2019 foresees the possibility of the late filing of declaration.

    That the deadline under Section 3 is a directory provision.

    That filing late return cannot be penalized if tax has been paid.

    And that factually the issue arose due to a technical failure of FBR’s online system.

    The FBR’s online portal should be reopened at the very least for filing of declaration of those persons who deposited the tax under the Act 2019 on or before June 03, 2019.

    The PTBA said that the taxpayers, who had paid due tax under this Act, should have been allowed to file their declaration as the basic purpose of the said scheme was to facilitate the taxpayers in order to achieve the objective of documentation of economy and revival of taxation system within the country by bringing more and more people into tax net.

    “Needless to say that, the taxpayers also cannot be suffer from the technical failure of the FBR system.”

    The tax bar once again urged the FBR to allow the taxpayers, who had already paid due tax in this regard, to file their declaration under the Asset Declaration Act, 2019 through their e-portals.

  • Bashirullah Khan posted as Director General Intelligence, Investigation

    Bashirullah Khan posted as Director General Intelligence, Investigation

    ISLAMABAD: Federal Board of Revenue (FBR) on Friday notified posting of Dr. Bashirullah Khan as Director General, Directorate General of Intelligence and Investigation (Inland Revenue) with immediate effect.

    Dr. Basirullah Khan, a BS-21 officer of Inland Revenue Service (IRS) has been transferred from the post of Chief Commissioner, Regional Tax Office (RTO), Rawalpindi.

    Qaiser Iqbal, BS-21 officer of IRS, has been transferred and posted as Chief Commissioner IR, RTO, Rawalpindi from the post of Director General, Directorate General of Intelligence and Investigation (Inland Revenue), Islamabad.

  • Income tax return filing date extended to December 16

    Income tax return filing date extended to December 16

    In a significant relief for taxpayers, the Federal Board of Revenue (FBR) has once again extended the deadline for filing income tax returns and wealth statements for the tax year 2019. According to FBR’s latest notification – Circular No. 16/2019 – the new date for submission has been set as December 16, 2019, offering individuals and companies a final opportunity to comply with their tax obligations.

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  • FBR, PBA agree on sharing account holders information; banks to withdraw court cases

    FBR, PBA agree on sharing account holders information; banks to withdraw court cases

    KARACHI: Federal Board of Revenue (FBR) has made major breakthrough regarding obtaining information of bank account holders ahead of FATF review.

    The FBR and commercial banks agreed on sharing information of financial transactions by account holders, which was remained under litigation since 2013.

    The FBR sources said that it would help the tax machinery to identify the movement of black economy and also ensure compliance to FATF conditions regarding prevention of money laundering and other fiscal crimes.

    The FATF next review is scheduled in February 2020 to decide Pakistan status, as the country is presently in the grey list.

    FBR chairman Syed Shabbar Zaidi in a tweet message on Friday said: “On behalf of FBR, I thank Pakistan Bank Association and Presidents of all the banks for agreeing to withdraw pending litigation on the matter of furnishing of certain information. This positivity has been achieved by mutual consultation. A way forward of cooperation has opened.”

    In a meeting held on November 27, 2019 at the Large Taxpayers Unit (LTU) Karachi which was chaired by FBR Chairman and attended by members of Pakistan Banks Association (PBA).

    The meeting discussed the issued regarding information to be provided by the banks under Section 165A of the Income Tax Ordinance, 2001.

    The chairman emphasized that the Section 165A had been amended on the specific request of the PBA in 2014, 2018, and recently through Supplementary Finance Amendment Act, 2019.

    Therefore, members should have no objection to the withdrawal of petition in the higher courts, the chairman said.

    After detailed deliberations, the meeting decided that the PBA would withdraw their petitions from the higher courts and provide information under Section 165A after mutual consultation with the FBR.

    The participants of the meeting besides FBR chairman Syed Shabbar Zaidi, included Muhammad Aurangzeb, President/CEO, Habib Bank Limited, Chairman, PBA and Imran Maqbool, President/CEO, MCB Bank limited, Vice Chairman, PBA.

    Representatives of banks who are also executive members of PBA were also present at the meeting.

  • FBR auditor awarded dismissal from service for availing NAB plea bargain

    FBR auditor awarded dismissal from service for availing NAB plea bargain

    ISLAMABAD: Federal Board of Revenue (FBR) has imposed major penalty on a senior auditor (BS-18) for making money through corruption and avail plea bargain of National Accountability Bureau (NAB).

    In a notification issued on Friday, the FBR said that Ali Akbar Tunio, Assistant Director (Audit) ( BS-18), Regional Tax Office-II, Karachi had availed the benefits of plea bargain in terms of section 25 (b) of National Accountability Ordinance, 1999 as per Accountability Court-III, Sindh, Karachi judgement dated May 23, 2019.

    The competent authority i.e. Secretary Revenue Division, after examining the case in light of provisions contained in Rule 8 of the Government Servants (Efficiency & Discipline) Rules 1973 has imposed major penalty of “Dismissal from Service” under Rule 4 (1)(b)(iv) with effect from the date of conviction i.e. May 23, 2019.

    In light of the above, major penalty of dismissal from service is imposed upon Ali Akbar Tunio, Assistant Director (Audit) ( BS-18), Regional Tax Office-II, Karachi under Rule 4(1)(b)(iv) of the Government Servants (Efficiency & Discipline) Rules, 1973 with effect from the date of conviction i.e. 23.05.2019.

    Ali Akbar Tunio, Assistant Director (Audit) ( BS-18), Regional Tax Office-II, Karachi shall have a right to file an appeal to Appellate Authority under Civil Servants (Appeal) Rules, 1977 within a period of 30 days from the date of communication.