Taxpayers in Pakistan face significant challenges, including highhandedness, inefficiency, and corruption by tax officials. To address these issues and rebuild trust between taxpayers and the government, it is imperative to introduce a Taxpayers’ Bill of Rights. This initiative would protect citizens from exploitation and harassment while fostering a sense of confidence in the state’s tax collection mechanisms.
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Customs Intelligence Lahore announces auction of heavy bikes, cars on Dec 30
ISLAMABAD: Directorate of Intelligence and Investigation (Customs), Lahore has announced auction of cars and heavy motor bikes on December 30, 2019 at State Warehouse of the directorate.
The directorate will auction following motor vehicles:
01. Heavy Motor Cycle Yamaha Brand 1000CC, Made in Japan, Model, RI 2000, Chassis No. JYARN041000003182
02. Honda Heavy Motor Cycle, Model 1992, Chassis No. 2073695
03. Heavy Bike Yamaha Motorcycle 500CC, Model 2006, Chassis No. JYASJ03100003295
04. BMW Car 745Li, Model 2002, Chassis No. WBAGN62040DE55989
05. Toyota Corolla (G) Car, Model 2002, Chassis No. NZE121-0212361
06. Mercedes Benz E230, Model 1996, Chassis No. WDB2100372A206137
07. Toyota Crown Car, Model 2004, Chassis No. GRS182-0008221
08. Mercedes Benz S500, Model 2001, Chassis No. WDB2201652A182102
09. Toyota Hilux Surf, Model 1998, Chassis No. VZN185-0210838
10. Toyota Land Cruiser Prado TZ, Model 2003, Chassis No. VZ121-0007432
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Valuation of concealed assets for income tax recovery
KARACHI: Federal Board of Revenue (FBR) shall conduct valuation for the purpose of income tax recovery on those assets which were identified as concealed.
According to Income Tax Rules, 2002, the valuation of concealed assets as under Section 111 of Income Tax Ordinance, 2001 would be taken as:
(1) The valuation of immovable property for the purposes of section 111 shall be taken to be-
(a) the fair market value of immovable property shall be the value notified by the Board under sub-section (4) of section 68 of the Income Tax Ordinance, 2001, in respect of area or areas specified in the said notifications;
(b) if the fair market value of any immovable property of any area or areas has not been determined by the Board in the notification referred to in sub-section (4) of section 68, the fair market value of such immovable property shall be deemed to be the value fixed by the District Officer (Revenue) or provincial or any other authority authorized in this behalf for the purposes of stamp duty; and
(c) in the case of agricultural land, the value shall be equal to the average sale price of the sales recorded in the revenue record of the estate in which the land is situated for the relevant period or time;
(d) if in a case sale price recorded in the instrument of sale of any property is higher than the fair market value as determined under clauses (a), (b) and (c), the applicable price shall be higher of the two; and
(e) in the case of sale price of any auctioned property or the fair market value as determined under clauses (a), (b) and (c), the higher price shall be applicable.
(2) For the purposes of section 111 and subject to sub-rule (2), the value of motor cars and jeeps shall be determined in the following manner, namely:-
(a) the value of the new imported car or jeep shall be the C.I.F. value of such car or the jeep, as the case may be, plus the amount of all charges, customs-duty, sales tax, levies, octroi fees and other duties and taxes leviable thereon and the costs incurred till its registration;
(b) the value of a new car or jeep purchased from the manufacturer or assembler or dealer in Pakistan, shall be the price paid by the purchaser, including the amount of all charges, customs-duty, sales tax and other taxes, levies, octroi, fees and all other duties and taxes leviable thereon and the costs incurred till its registration;
(c) the value of used car or jeep imported into Pakistan shall be the import price adopted by the customs authorities for the purposes of levy of customs-duty plus freight, insurance and all other charges, sales tax, levies octroi, fees and other duties and taxes leviable thereon and the costs incurred till its registration.
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FBR’s helpline receives 24,270 complaints in December
ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday said that its helpline received 24,270 complaints so far in December 2019.
“Out of these complaints, most of the complaints were disposed without any delay. Only some complaints of technical nature took a little time in disposal,” the FBR said.
Likewise, the number of complaints sent through E-mail was 11447. Out of these, 7126 complaints were addressed immediately, the rest 4321 were resolved after seeking assistance from concerned Wings, the FBR added.
The FBR said its helpline is a free, fast & reliable service that is committed to provide the very best service to the public.
FBR’s Helpline not only educates the public but also provides them a forum through which the public can put forward their queries and seek resolution to most of their issues via phone, email or website.
Helpline team has been at the forefront in resolving issues that come up from time to time such as payment of Surcharge for ATL, guidance for newly launched Online Sales Tax Registration application, guidance for newly launched Biannual Income Tax Withholding Statement, guidance for ST Returns launched for the new financial year.
The Helpline is providing services to the public in two shifts. Furthermore, the Helpline representatives are providing all possible support to the Taxpayers in ensuring that they are easily able to navigate various Transactional portals such as Income Tax portal (Iris) etc.
FBR Helpline utilizes international standard Customer Relationship Management (CRM) System, which ensures availability of three (3) tier support lines ensuring that FBR Helpline promptly resolves Taxpayer issues.
The FBR said that taxpayers are provided a case number for each complaint lodged and resolution of the case is ensured within 24 hours of the complaint lodged.
Cases of complex nature which require legal and technological modification in the system are resolved within 3 days of the lodged complaint.
The FBR is committed towards bringing about a Service Oriented Culture– geared towards resolving challenges faced by investors and taxpayers, helping to improve the Ease of Doing Business (EoDB).
“FBR understands its responsibilities as a Partner in Progress- where its sole responsibility isn’t just to collect taxes but also ensure that it provides the very best service; ushering in a tax compliant culture while providing the necessary tools for economic growth,” the statement said.
FBR Helpline can be reached through phone (051-111-772-772) and email ([email protected]), plus complaints can also be lodged through the website (www.fbr.gov.pk).
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FBR constitutes market committees at 17 RTOs
ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday constituted market committees within the jurisdiction of 17 Regional Tax Offices (RTOs) to resolve the issues of small traders and retailers.
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No tax on cash withdrawal from banks on active taxpayers: FBR
ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday said that there is no tax on cash withdrawal from banks for those whose names are on the Active Taxpayers List (ATL).
Otherwise, the withholding tax rate on cash withdrawal is 0.6 percent for persons not appearing on the ATL.
In order to ensure names on ATL, taxpayers are required to file their annual income tax returns. The FBR urged the taxpayers to avail the extended the last date for filing income tax returns for tax year 2019, which is December 31, 2019.
The FBR said that in case of enlistment in the ATL, the taxpayers shall have following benefits:
— Almost half of the withholding tax as compared with the inactive taxpayers
— 5.5 percent tax on imports (raw material)
— 6 percent tax on imports (commercial)
— 15 percent tax on dividends
— 10 percent tax on bank and savings scheme profit worth up to Rs0.5 million and 15 percent on above Rs0.5 million
— 4.5 percent tax on sale of goods by persons except companies
— 10 percent tax on provision of services by persons except companies
— 7.5 percent tax on contract executed by person except companies
— 15 percent tax on prize bonds money of prize bonds
— 12 percent tax on commission
— Annual token fee of vehicles from Rs800 to Rs10,000
— Withholding tax on vehicle registration from Rs7,500 to Rs250,000
— No tax on cash withdrawal of more than Rs50,000 from banks
— No tax on bank transactions (cross cheque, pay order, demand draft etc.)
— One percent tax on purchase of property
— 10 percent tax on sale by auction
— Tax on mobile phone import from Rs70 to Rs200
— 10 percent tax deduction for payment against advertisement to non-resident person
The FBR said that in case of no enlistment in the ATL, the following tax rates are applicable:
— Almost double tax rates
— 11 percent tax on imports (raw material)
— 12 percent tax on imports (commercial)
— 30 percent tax on dividends
— 20 percent tax on bank and savings scheme profit worth up to Rs0.5 million and 30 percent on above Rs0.5 million
— 9 percent tax on sale of goods by persons except companies
— 20 percent tax on provision of services by person except companies
— 15 percent tax on contract executed by person except companies
— 30 percent tax on prize money of prize bonds
— 24 percent tax on commission
— Annual token fee of vehicles from Rs1,600 to Rs20,000
— Withholding tax on vehicle registration from Rs15,000 to Rs500,000
— 0.6 percent tax on cash withdrawal of more than Rs50,000 from banks
— 0.6 percent tax on bank transactions (cross cheque, pay order, demand draft etc.)
— 2 percent tax on purchase of property
— 20 percent tax on sale by auction
— Tax on mobile phone import from Rs140 to Rs400
— 20 percent tax deduction for payment against advertisement to non-resident person
The FBR said that those persons failed to file their return then the tax authorities would assess the applicable tax without serving any notice. Further, legal action will be taken resulting into imprisonment of one to three years.
The FBR also said that late income tax return filers will pay fine.
The FBR said that the filing of income tax returns is mandatory for all persons with annual income of Rs400,000 or more.
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FBR needs to collect Rs2,198 billion in first half of current fiscal year
KARACHI: Federal Board of Revenue (FBR) is required to collect Rs2,198 billion during first half of the current fiscal year as per revised performance criteria of International Monetary Fund (IMF).
The revenue collecting agency has failed to achieve the first quarter performance criteria.
According to Country Report Pakistan released by IMF on Monday the actual performance criteria for revenue collection was Rs2,367 billion during first half (July – December) of current fiscal year, which has been revised downward by Rs169 billion to Rs2,198 billion.
This shows that the FBR will need to collect Rs590 billion in the month of December 2019 to achieve the revised performance criteria.
The FBR’s provisional collection during first five months (July – November) 2019/2020 was Rs1,608 billion.
As per IMF documents the FBR failed to achieve the first quarter (July – September) 2019/2020 target of Rs1,071 billion and its collection was at Rs964 billion.
The actual revenue collection target for current fiscal year was Rs5,550 billion. However, the indicative target as per IMF documents has also been revised downward to Rs5,238 billion.
The FBR has to raise revenue collection to Rs3,520 billion by March 2020 in order to ensure the desired target for current fiscal year.
As per IMF documents: “Tax revenue is now expected to be 0.5 percent of GDP lower than originally expected: while domestic collection is envisaged to remain strong, growing by over 25 percent y-o-y over FY 2020, growth in trade-related tax revenues is expected to remain subdued as declining imports continue to weigh on collections—more than 40 percent of total tax revenue in Pakistan is collected at the import stage.”
The FBR has been given revised Indicative Targets for end December 2019 including net tax collection to recognize the faster than expected external adjustment negatively impacting customs revenue, besides net accumulation of tax refund arrears to capture the authorities plan to reflect the end-June stock of tax refund arrears.
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Tax return filing hits new record at 2.73 million
KARACHI: The income tax return filing touches to a new record high of 2.73 million as people making compliance to avoid 100 percent additional tax on persons not appearing on Active Taxpayers List (ATL).
The income tax return filing increased to 2.73 million on the basis of returns filed till December 22, 2019 for tax year 2018.
Sources in Federal Board of Revenue (FBR) attributed the record increase in return filing to the amendment to Income Tax Ordinance, 2001 through Finance Act, 2019.
In the last budget 2019/2020 a new Tenth Schedule was inserted to Income Tax Ordinance, 2001 under which persons not appearing on ATL would liable to pay 100 percent more withholding tax on certain transactions.
The ATL for tax year 2018 issued on March 01, 2019 in which 1.59 million names were appeared of those taxpayer, who filed their returns by due date.
However, later the FBR granted extension in date for filing returns due to introduction of a tax amnesty scheme.
The extension for filing income tax returns for tax year 2018 was granted up to August 09, 2019.
The return filing up to August 09, 2019 for tax year 2018 jumped up to 2.5 million from 1.59 million returns, which were part of the first ATL issued March 01, 2019.
The insertion of Tenth Schedule to Income Tax Ordinance, 2001 speed up the return filing by taxpayers in order to avoid higher tax rate on certain transactions.
Previously, people filing their annual income tax returns after due date were not allowed to appear on the ATL. However, another provision was added to the main statute under which persons by paying penalty can include their name to ATL.
Therefore, since August 09, 2019 the FBR received around 230,000 tax returns for tax year 2018 till December 22, 2019.
The FBR will issue ATL for tax year 2019 on March 01, 2020 and till then the prevailing ATL will be applicable for the purpose of withholding tax rates on certain transactions.
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NCCPL to collect CGT for Oct-Nov on Jan 03
KARACHI: National Clearing Company of Pakistan Limited (NCCPL) on Monday announced to collection capital gain tax (CGT) for the months of October – November 2019 on January 03, 2020.
In a communication sent to Pakistan Stock Exchange (PSX), the NCCPL said that the aggregate amount of CGT arising on disposal of shares at PSX for the period October 01, 2019 to November 30, 2019, would be collected on Friday January 3, 2020 through respective settling banks of the Clearing Members.
The NCCPL advised all clearing members to ensure requisite amount in their respective settling bank’s account. Necessary details and reports for the said period have already been made available in the CGT System.
Further, the aggregate amount of CGT arising on trading of future commodity contracts at Pakistan Mercantile Exchange for the period October 01, 2019 to November 30, 2019, would also be collected from the Pakistan Mercantile Exchange on Friday January 3, 2020.
Necessary details and reports for the said period have already been made available.
Moreover, the aggregate amount of CGT arising on redemption of units of open end mutual funds have also been finalized for the period July 01, 2019 to November 30, 2019. Necessary details and reports have already been made available in the CGT System.
Clearing Members and Pakistan Mercantile Exchange are hereby requested to verify the investor wise details of capital gain or loss and tax thereon, if any, through reports/downloads.
The NCCPL warned that in case of none or partial collection of CGT, necessary action would be taken in accordance with the Rules and NCCPL Regulations.
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Sindh finalizes action against tax defaulting motor vehicles from Dec 23
KARACHI: Sindh Excise and Taxation Department is finalize arrangements for launching a drive against tax defaulting motor vehicles from December 23, 2019.
Teams have been constituted to launch the drive against tax defaulting motor vehicles across the province.
This decision was made at a meeting, chaired by the Minister of Excise and Taxation and Narcotics Control and Parliamentary Affairs, Mukesh Kumar Chawla.
The meeting was also attended by Secretary Excise and Taxation & Narcotics Control Abdul Haleem Sheikh, Director General Excise and Taxation & Narcotics Control Shoaib Ahmed Siddiqui and other officers.
Giving the briefing to the meeting, Director General Shoaib Ahmed Siddiqui said that a massive public awareness campaign had been launched through media so that they could deposit their taxes in a timely manner and on the occasion of the road checking campaign, tax defaulting vehicles would be confiscated and the vehicles would be returned only after payment of due taxes and the arrears.
Addressing the meeting, the Minister for Excise and Taxation & Narcotics Control and Parliamentary Affairs, Mukesh Kumar Chawla, advised the owners of the vehicles to transfer the vehicles into their names immediately after purchasing the vehicle because driving on open litter is a crime.
He added that if the vehicle was used in a crime, then the person whose name was at that time, would be considered legally the original owner while there were 15 branches of National Bank of Pakistan for the convenience of the people to deposit their due taxes have been assigned and the details of these branches are posted on the department’s website and published in newspapers as well.
On this occasion DG Shoaib Ahmed Siddiqui told that National Bank Branches were at Awami Markaz, Clifton, Site Area, Nazimabad, Shahbaz Building Hyderabad, Millat Road, Korangi Industrial Area, M.A. Jinnah, Dinsu Hall, Fatima Road Jinnah Road Hyderabad, DHA, PIDC, I.I Chandigarh Road, Gulshan and High Court.
In case of any problem, people might contact, Director Karachi 99203671, Director Mirpur Khas 0233-9290211, Director Sukkur 071-9310202, Deputy Director Admin. Karachi 021-99201410, Director Hyderabad 022-9200148, Director Shaheed Benazir Abad 0244-9370178 and Director Larkana 074-9410751.
Provincial Minister Mukesh Kumar Chawla advised the owners of tax defaulting vehicles to deposit their taxes before December 23 to avoid any unpleasant situation on the roads.
He also directed the officers/officials to remain polite with the owners of the vehicles but strict in implementing the law as he would not tolerate any lethargic attitude in this regard.