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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.

  • Customs duty to apply on re-importation of goods manufactured in Pakistan

    Customs duty to apply on re-importation of goods manufactured in Pakistan

    KARACHI: Federal Board of Revenue (FBR) has said that customs duty shall be applied on re-importation of goods that are manufactured and exported from Pakistan.

    The FBR issued Customs Act, 1969 updated June 30, 2019 and explained re-importation of goods produced or manufactured in Pakistan under section 22 of the Act.

    Section 22: Re-importation of goods produced or manufactured in Pakistan

    If goods produced or manufactured in and exported from Pakistan are subsequently imported into Pakistan, such goods shall be liable to customs-duties and be subject to all the conditions and restrictions, if any, to which goods of the like kind and value not so produced or manufactured are liable on the importation thereof:

    Provided if such goods have been imported within one year of their exportation and have been consigned to the person in whose account they were exported and have not undergone any processing since their exportation, the appropriate officer not below the rank of Assistant Collector of Customs may admit the goods-

    (a) Where at the time of exportation of such goods, rebate, refund or drawback of any customs or Federal Excise duty or any other tax levied by the Federal Government or any tax, cess or duty levied by the Provincial Government was allowed on payment of customs duty equal to the amount of such rebate, refund or drawback as the case may be;

    (b) where such goods were exported in bond, without payment of –

    (i) the customs-duty chargeable on the imported materials, if any, used in the manufacture of the goods; or

    (ii ) the Federal Excise duty chargeable on the indigenous materials, if any, used in the manufacture of such goods; or

    (iii) the Federal Excise duty, if any, chargeable on such goods; or

    (iv) any other tax chargeable on the material used in the manufacture of such goods; or

    (v) any other tax chargeable on such goods, on payment of customs-duty equal to the aggregate amount of all such duties and taxes calculated at the rates prevailing at the time and place of importation of goods; or

    (c) in any other case, without payment of duty.

    Section 22A: Temporary export of imported plant and machinery

    Imported plant and machinery, temporarily exported that have not undergone any alteration, renovation, addition or refurbishment, may be re-imported duty free subject to the specific or general terms and conditions the Board may by the rules prescribe.

  • FED imposition may negatively affect local automobile assembling: SBP

    FED imposition may negatively affect local automobile assembling: SBP

    KARACHI: The State Bank of Pakistan (SBP) has said that the imposition of federal excise duty (FED) may negatively affect local automobile industry as imported parts would become costlier.

    The enhancement of FED on imported vehicles could increase the demand for locally assembled vehicles. “However, because of increase in FED on the imported parts, automobile assemblers, who mostly rely on imported components, might be negatively affect,” the SBP said in its Financial Stability Review (FSR) released last week.

    FED on imported vehicles has been amended from 20 percent on vehicles above 1800cc to 25 percent for vehicles between 1800cc and 3000cc, and 30 percent for 3000cc or above.

    The central bank said that the automobile sector has the highest operational efficiency in the corporate sector.

    “It has, however, faced a contraction in the gross profit margin in CY18, as the bar on non-filers against purchase of new car affected the demand and the devaluation of the currency put pressure on production costs and profit margins.”

    Resultantly, local assemblers increased their prices to sustain profitability.

    “The outlook is positive in terms of enhanced production capacity as Kia, Hyundai and Renault are expected to enter the market in the coming years.”

  • MCC Preventive Peshawar announces auction of confiscated vehicles on Sept 11

    MCC Preventive Peshawar announces auction of confiscated vehicles on Sept 11

    ISLAMABAD: Model Customs Collectorate (MCC) Preventive Peshawar has announced auction of confiscated vehicles on September 11, 2019 at various state warehouses.

    Following vehicles will be presented for auction:

    STATE WARE HOUSE, PESHAWAR

    01. Honda Accord Car Model 1987 Chassis No. JHMCA5300C000462

    02. Mercedes Benz (Bullet Proof) Model 1982 Chassis No. WDB-12603312037551

    03. Honda Accord Motor Car 1985 Chassis No. JHMCA45300C002584

    04. Mercedez Benz Truck Model 1995 Chassis No. WDB6770381K175873

    05. Mitsubishi Pajero Jeep Model 2006 Chassis No. JMYLNV76W6J001329

    06. Toyota Land Cruiser Prado Model 1999 Chassis No. LJ90-0002325

    07. Toyota Hilux Pick Up 4X4 Model 1997 Chassis No. JT733LNA309004002

    08. Toyota Hilux Pick Up Model 2007 Chassis No. MROCS12G400043443

    09. Toyota Fielder Car Model 2002 Chassis No. NZE121-0134145

    10. Mitsubishi Pajero Model 2006 Chassis No. JMYLNV76W6J001340

    11. Toyota Land Cruiser Model 2004 Chassis No. LTERB71J800020686

    12. Toyota Hilux Pick Up Model 2001 Chassis No. JTFDE626800061496

    13. Toyota Camry Car Model 2014 (as per Website) Chassis No. 6TIBF3FK-40X056581

    14. Mercedez Benz Car Model 2002(as per Website) Chassis No. WDB2100162B169560

    15. Toyota Land Cruiser 1993 Chassis No. KZJ78-0007642

    STATE WARE HOUSE MARDAN

    01. Toyota Surf Model 1996 Chassis No. RZN185-0015007

    STATE WARE HOUSE, ABBOTTABAD

    01. Toyota Mark-X Car Model 2006 Chassis No. GRX120-0009539

    STATE WARE HOUSE, FRONTIER CORPS

    01. Toyota Corolla Car Model 2007 Chassis No. NZE120-6073022

    02. Daewoo Car Model 1992 Chassis No. KLATF19TINB-522281

    03. Toyota 2D Corolla Car, 1992 Chassis No. EE101-3046367

    04. Pickup Model 1980 Chassis No. RN43-003433

    05. Toyota Land Cruiser Model 1988 Chassis No. LJ-710003848

    06. Mark-1 Motor Car Model Nil Chassis No. LA3VS-216474

    07. Motor Car Model 1978 Chassis No. M-430-300918

    08. Toyota Corolla Car Model 1982 Chassis No. A171-A-8024009

    09. Toyota Pick Up Model 1980 Chassis No. RN40-069388

    10. Toyota Corolla Car Model 2003 (as per Website) Chassis No. NZE120-6005014

    11. Toyota Double Cabin Model 1996 (as per Website) Chassis No. JT133LNA409046824

    12. Towance Model 1994 (as per Website) Chassis No. CR22-5016240

    13. Suzuki Mehran Car Model 1989 Chassis No. SB308PK622878

    14. Toyota Pick Up Double Cabin Model 1986 (as per Website) Chassis No. LN56-0075058

    15. Toyota Corolla Car Model 1992 (as per Website) Chassis No. CE100-3020027

    16. Toyota Mark-II Car Model 2001 (as per Website) Chassis No. JZX110-6022047

    17. Suzuki Alto Car Model 2002 Chassis No. HA23S-689157

    18. Toyota Corolla Saloon Car Model 2004 (as per Website) Chassis No. ZZE121-9010983

    19. Suzuki “VXR” Car Model 2001 Chassis No. HA23S-613292

    20. Honda Motor Cycle CG-125 Model 2005 Chassis No. S74083

    21. Honda Motor Cycle CG-125 Model 2003 Chassis No. D72343

    22. Honda Motor Cycle CG-125 Model 2007 Chassis No. BJ017444

    23. Honda Motor Cycle CG-125 Model 2001 Chassis No. PF012620

    24. Honda Motor Cycle Deluxe 125CC Model 2006 Chassis No. BJ006783

    25. Toyota Corolla Car Model 2001 (as per Website) Chassis No. CE100-9020816

  • FBR to collect FED on steel products, rescinds sales tax notification

    FBR to collect FED on steel products, rescinds sales tax notification

    KARACHI: The government has decided to collect federal excise duty from steel products instead of sales tax. In this regard the Federal Board of Revenue (FBR) has issued 992(I)/2019 dated September 04, 2019 to implement the decision.

    The FBR issued minimum values of locally produced goods for the purpose of payment of federal excise duty in sales tax mode on ad valorem basis, at the rate defined below under the First Schedule to the Federal Excise Act, 2005:

    01. Steel bars and other long profiles at the value of Rs83,000 per metric ton.

    02. Steel Billets at the value of Rs74,000 per metric ton.

    03. Steel Ingots/bala at the value of Rs72,000 per metric ton.

    04. Ship plates at the value of Rs72,000 per metric ton.

    05. Other re-rollable iron and steel scrap at the value of Rs71,000 per metric ton.

    The FBR further explained that in ccase the value of the goods specified in the Table above, as determined under sub-section (I) of Section 12 of the Federal Excise Act, 2005, is higher than the value fixed herein, the value of goods shall be such higher value.

    The FBR also rescinded the SRO 697(I)/2019 dated June 29, 2019 through SRO 993(I)/2019.

    Through SRO 697(I)/2019 the fbr issued the fixed value of locally produced goods for the purpose of sales tax on ad valorem basis under the Sales Tax Act, 1990.

    01. Steel bars and other long profiles at the value of Rs83,000 per metric ton.

    02. Steel Billets at the value of Rs74,000 per metric ton.

    03. Steel Ingots/bala at the value of Rs72,000 per metric ton.

    04. Ship plates at the value of Rs72,000 per metric ton.

    05. Other re-rollable iron and steel scrap at the value of Rs47,000 per metric ton.

    The SRO 697(I)/2019 was imposed from July 01, 2019.

  • Salary tax slabs for filing returns tax year 2019

    Salary tax slabs for filing returns tax year 2019

    KARACHI: The salaried person shall follow the following slabs for filing income tax returns for tax year 2019 which is due on September 2019.

    01. Where the taxable income does not exceed Rs400,000 the tax shall be zero.

    02. Where the taxable income exceeds Rs400,000 but does not exceed Rs800,000 the tax amount shall be Rs1,000.

    03. Where the taxable income exceeds Rs800,000 but does not exceed Rs1,200,000 the tax amount shall be Rs2,000.

    04. Where the taxable income exceeds Rs1,200,000 but does not exceed Rs2,500,000 the tax shall be 5 percent of the amount exceeding Rs. 1,200,000.

    05. Where the taxable income exceeds Rs2,500,000 but does not exceed Rs4,000,000 the tax shall be Rs65,000 + 15 percent of the amount exceeding Rs2,500,000.

    06. Where the taxable income exceeds Rs4,000,000 but does not exceed Rs8,000,000 the tax shall be Rs290,000 + 20 percent of the amount exceeding Rs4,000,000.

    07. Where the taxable income exceeds Rs8,000,000 the tax shall be 1,090,000 + 25 percent of the amount exceeding Rs8,000,000.

    Provided that where the taxable income exceeds eight hundred thousand rupees the minimum tax payable shall be two thousand rupees.

    The Federal Board of Revenue (FBR) has issued the final income tax return forms for all categories of taxpayers in order to ensure to complete return filing by September 30, 2019.

  • Benami property holder may get 7 years jail, pay 25pc as fine

    Benami property holder may get 7 years jail, pay 25pc as fine

    In a significant move aimed at curbing illicit financial activities and tax evasion, the Benami Transaction (Prohibition) Act, 2017 has brought about stringent penalties for those involved in benami transactions in Pakistan.

    (more…)
  • FBR issues finalized return forms for companies

    FBR issues finalized return forms for companies

    The Federal Board of Revenue (FBR) has officially released the finalized return forms for companies, marking a crucial step in the taxation process for the tax year 2019.

    (more…)
  • FBR decides to update units of measurement for trade facilitation

    FBR decides to update units of measurement for trade facilitation

    ISLAMABAD: Federal Board of Revenue (FBR) has decided to update the units of measurements in order to facilitate trade. FBR chairman Syed Shabbar Zaidi has issued instructions to customs authorities, said a statement on Friday.

    It said that this exercise is likely to be completed in week’s time and new units of measurement shall be notified and difficulties faced by the importers/exporters regarding unit of measurements will get addressed.

    It will also result in ease of doing business.
    In order to bring the national trade data in conformity with international standards, the units of measurement (UoM) are made uniform in accordance with the guidelines of World Customs Organization (WCO).

    This uniformity not only helps in collection, comparison and analysis of trade statistics but also simplify the process of assessment resulting in speedy clearance of goods.

    The standard units of measurements were previously notified by the Federal Board of Revenue in the year 2012.

    Despite the fact that these need to be revisited and updated on regular basis, no exercise to this effect was carried out in the last seven (7) years.

    After the issuance of new CGO all field formations of Customs will be directed to adopt standard units of quantity/measurement (UoM) expressed therein and accordingly, the importers/clearing agents/shipping agents will be required to fill invoices/documents in line with new UoM.

  • Tax payment made must for return filing date extension

    Tax payment made must for return filing date extension

    ISLAMABAD: In order to achieve first quarter target the Federal Board of Revenue (FBR) has directed all the chief commissioners of Inland Revenue to ensure payment of taxes before allowing extension in date for return filing beyond September 30, 2019.

    The FBR has required huge amount to achieve quarterly (July – September 2019) revenue collection target of Rs1078 billion and it had managed to collect Rs 562 billion in first two months of current fiscal year.

    A circular issued by the FBR on Friday, stated that payment of due taxes should be ensured before allowing extension of income tax returns/statements for the tax year 2019.

    All chief commissioners Inland Revenue should ensure that before granting extension in the date of filing Income Tax Return for the tax year 2019 in the cases where last date of filing of Income Tax Returns is September 30, the admitted tax liability is discharged before September 30, 2019.

  • FBR simplifies tax rules to facilitate SMEs

    FBR simplifies tax rules to facilitate SMEs

    ISLAMABAD: Federal Board of Revenue (FBR) on Friday issued simplified tax rules for facilitation of small and medium enterprises (SMEs).

    FBR has changed the rules to facilitate Small and Medium Enterprises to enhance exports through Notification No. 1002(I)/2019 dated 06.09.2019 which has introduced amendments in original Notification 327(I)/2008 dated 28.03.2008.

    This is in line with the directives of the Prime Minister of Pakistan to simplify the tax laws and to automate the business processes to bring transparency in the system.

    In order to implement this vision, FBR under the leadership of Shabbar Zaidi, Chairman, has simplify this export scheme and provided new incentives for the business community.

    The Small and Medium Enterprise Units working under this scheme is the largest export promotion scheme presently being used by the export sector.

    Besides introducing amendments in the Export Oriented Units Scheme, the Federal Board of Revenue has also automated these processes in the computerized clearance system WeBOC. This will further reduce human interaction and create business friendly environment.

    According to the details, the retention period of plant, machinery and capital goods is reduced from 10 years to 5 years.

    This will help export industry to keep abreast of latest developments and trendsin the technology.

    If plant, machinery and capital goods are sold or otherwise disposed of before the expiration of five, then different slabs of duty and taxes are introduced whereas after five years disposal of such plant and machinery is allowed without payment of duty and taxes.

    Similarly, disposal mechanism of spares and replacement parts have been provided and now these parts are allowed to be disposed offafter three years.

    To address delays in processing, tiers of administration have been reduced. Now Regulatory Authority is created and the powers have been devolved to Additional Collectorfor grant, revalidate or amend EOU licenses.

    In the new scheme, if there are any problems, the businessman can approach Chief Collector of Customs for redressal of their grievances.

    In order to alleviate the burden of getting the analysis card issued from Input Output Coefficient Organization (IOCO) or Engineering Development Board (EDB) against each license, now if ratio in the analysis certificate is similar to the ratio determined in the previous year, then the Regulatory Authority will issue the license without seeking recommendations from IOCO/EDB.

    Moreover, the provision for issuance of the provisional analysis certificate has also been provided in the Export Oriented Unit Rules in case of delay caused by IOCO/EDB so that the processes of the Export Oriented Units may not get hurt.