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Dollar climbs up to PKR 219.38 in early interbank trading

KARACHI: The US dollar climbed up against the Pakistani Rupee (PKR) to reach PKR 219.38 in early day trading at interbank foreign exchange market on Friday.

The foreign currency gained PKR 1 to trade at PKR 219.38 from previous day’s closing of PKR 218.38 in interbank foreign exchange market.

READ MORE: Dollar ends up to PKR 218.38 in interbank on Oct 13, 2022

The dollar rebounded on October 12, 2022 after making a losing streak for straight 13 sessions to the PKR.

The exchange rate reached to near record low of PKR 239.71 on September 22, 2022 to the dollar but ended at PKR 217.79 on October 10, 2022. Dar recently claimed that the actual value of the dollar is below PKR 200 and he vowed to bring it down.

READ MORE: Dollar ends 13-day losing streak; ends at PKR 217.88

Currency experts said that the rising dollar demand was due to falling foreign exchange reserves and increasing import payments.

Pakistan’s foreign exchange reserves continued to decline and depleted by $342 million to $13.247 billion by week ended October 07, 2022. The foreign exchange reserves of the country were at $13.589 billion a week ago i.e. September 30, 2022.

READ MORE: PKR maintains winning streak to dollar for 13th straight session

The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $13.981 billion.

They said that the rupee had made gain during the past couple of weeks due to various measures taken by the central bank to curb the dollar hoarding.

READ MORE: Rupee gains for 12th straight session; dollar ends at PKR 217.97

October 14, 2022
FTO directs stop unlawful recovery from taxpayers’ bank accounts

Federal Tax Ombudsman (FTO) has directed the tax authorities to stop unlawful recovery from bank accounts of taxpayers.

The FTO issued the order dated September 30, 2022 in a complaint against non-issuance of refund amounting to Rs23.25 million for tax year 2016 along with compensation.

READ MORE: FTO investigates tax collection through electricity bills

According to the complainant, which is an Association of Person (AOP), filed return for tax year 2016. Later on, a tax office of the Federal Board of Revenue (FBR), amended the assessment order by making an addition of Rs1,754 million and rs164.21 million.

Being aggrieved, the complainant filed appeal before the Commissioner (Appeals), Gujranwala who modified the order and annulled the addition of Rs164 million, with the directions that the unit office for further necessary verification and confirmed the addition of Rs1,754 million.

READ MORE: President Alvi rejects FBR plea in maladministration cases

The tax office, recovered an amount of Rs23.25 million through attachment of bank accounts on the very next day without passing appeal effect order. Statedly, recovery was also made from bank accounts of some un-concerned persons.

The complainant filed appeal before appellate tribunal Lahore, who order granted stay order with certain observations.

The FTO in its findings revealed that the recovery of Rs23.25 million had been made from the complainant AOP and certain other unconcerned whereas no demand was in the field at the time of making such recovery. “This act of department tantamount to maladministration.”

READ MORE: FTO directs customs to clear pending auctions

It is also found that recovery from the bank accounts of unconcerned person is also an act which tantamount to maladministration.

The FTO in its recommendations to the FBR to ensure that an internal fact finding is conducted to see as who had recovered the amounts from bank account without giving appeal effect and without having legally recoverable tax demand on record.

READ MORE: KTBA passes resolution against FTO Asif Jah

FBR has been asked to issue clear directions to all field formations: forestalling unlawful recovery in the absence of any legally recoverable tax demand; and recovery from the accounts of unconcerned persons/entities.

October 13, 2022
Pakistan’s forex reserves continue to fall; deplete to $13.25 billion

Pakistan’s foreign exchange reserves continued to decline and depleted by $342 million to $13.247 billion by week ended October 07, 2022, State Bank of Pakistan (SBP) said on Thursday.

The foreign exchange reserves of the country were at $13.589 billion a week ago i.e. September 30, 2022.

READ MORE: Pakistan’s forex reserves decline to $13.59 billion

The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $13.981 billion.

The foreign exchange reserves of the SBP also declined by $303 million to $7.597 billion by week ended October 07, 2022 as compared with $7.9 billion a week ago.

READ MORE: State Bank’s forex reserves shrink to $8 billion

The central attributed the decline to external debt repayments, which included repayment of a commercial loan and interest payment on Eurobonds

The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021. Since then the official reserves of the SBP dropped by $12.549 billion.

READ MORE: Pakistan’s forex reserves slip to $14.07 billion

Experts said that falling foreign exchange reserves would reverse the recent gain in value of the Pakistani Rupee (PKR). The PKR make a 13-session winning streak. The exchange rate reached to near record low of PKR 239.71 on September 22, 2022 to the dollar but ended at PKR 217.79 on October 10, 2022. Dar recently claimed that the actual value of the dollar is below PKR 200 and he vowed to bring it down.

READ MORE: Pakistan FX reserves slip to $14.32 billion

Earlier this month, SBP received US$ 1,166 million from IMF under EFF program, which increased the official reserves to $8.8 billion.

The foreign exchange reserves held by commercial banks fell by $39 million to $5.65 billion by week ended October 06, 2022 as compared with $5.689 billion a week ago.

October 13, 2022
Dollar ends up to PKR 218.38 in interbank on Oct 13, 2022

KARACHI: The US dollar gained 50 paisas against the Pakistani Rupee (PKR) on Thursday amid demand for import payments and lower foreign exchange reserves.

The exchange rate recorded 50 paisas decline in rupee value to end at PKR 218.38 to the dollar from previous day’s closing of PKR 217.88 in the interbank foreign exchange market.

READ MORE: Dollar ends 13-day losing streak; ends at PKR 217.88

Currency experts said that the high import payment demand and lower foreign exchange reserves had starting pressure on the local unit.

It was second straight day when the dollar had made recovery after falling for 13 straight sessions.

The exchange rate reached to near record low of PKR 239.71 on September 22, 2022 to the dollar but ended at PKR 217.79 on October 10, 2022. Dar recently claimed that the actual value of the dollar is below PKR 200 and he vowed to bring it down.

READ MORE: PKR maintains winning streak to dollar for 13th straight session

The experts said that the rupee had made gain during the past couple of weeks due to various measures taken by the central bank to curb the dollar hoarding.

They said that tight monitoring of the State Bank of Pakistan (SBP) on foreign currency transactions helped the rupee to make gain.

Recently, the SBP had amended foreign exchange regulations with an objective to promote documentation and transparency in the foreign exchange transactions between exchange companies.

In terms of revised regulations, it has been made mandatory for Exchange Companies, Franchises of Exchange Companies and Exchange Companies of ‘B’ Category to settle Pakistan Rupee consideration of all foreign currency purchase/ sale transactions conducted among themselves through their bank accounts.

READ MORE: Rupee gains for 12th straight session; dollar ends at PKR 217.97

Besides, stress has been laid on ensuring that CCTV Systems of Exchange Companies and Exchange Companies of ‘B’ Category should be functional at all times (i.e. 24 hours a day and 7 days a week) as required under existing regulations.

However, in order to ensure transparency, it has been advised that Exchange Companies and Exchange Companies of ‘B’ Category shall not carry out any business activity during the period in which CCTV system is non-functional at any of their outlet for any reason, including technical faults, until the functionality of the CCTV system is restored.

READ MORE: Rupee gains for 11th session; dollar falls to PKR 219.92

Moreover, minimum preservation period of video recording through CCTV system has been enhanced from two to six months or until the inspection of the company by SBP, whichever is earlier.

This would ensure availability of CCTV recording for audit/inspection purposes, according to the SBP.

Meanwhile, the international oil prices also softened which helped the rupee to make gains.

The local currency witnessed the historic low at PKR 239.94 to the dollar on July 28, 2022.

October 13, 2022
Pakistan car sales plunge 50% in 1QFY23

KARACHI: Pakistan’s car sales plunged by 50 per cent to 34,472 units during the first quarter (July – September) of 2022-2023, according to data released by Pakistan Auto Manufacturers Association (PAMA).

The locally manufacturing of cars recorded 68,897 units in the same quarter of the last fiscal year.

READ MORE: Pakistan car sales plummet by 50% on import restriction

Major decline has been recorded in manufacturing of Pak Suzuki Motors, which fell by 57 per cent to 16,637 units during the first quarter of the current fiscal year as compared with 38,431 units in the same quarter of the last year.

Indus motors recorded a dip of 52 per cent to 8,868 units during the quarter under review as compared with 18,646 units in the same quarter of the last year.

The manufacturing of Honda Cars slipped by 39 per cent to 5,626 units in July – September 2022 as compared with 9,172 units in the corresponding period of the last year.

READ MORE: Pakistan car sales drop 59% in July 2022

However, Hyundai witnessed a jump of 34 per cent in manufacturing to 3,097 units during the first quarter of the current fiscal year as compared with 2,303 units in the same quarter of the last year.

Analysts at Topline Securities said that Pakistan car sales (including sales of Non-PAMA members) clocked in at 13k units down 7 per cent MoM primarily due to unavailability of CKD parts which led to non-production days by auto manufactures in September 2022.

Auto sales are also down by 51 per cent YoY amid escalating car prices, expensive auto financing, and low purchasing power of consumers. This takes 1QFY23 car sales to 34,472 units down 50 per cent YoY from 68,897 units in 1QFY22.

READ MORE: Pakistan car sales surge 54 per cent in FY22

All companies reported decline on MoM basis except for Pak Suzuki (PSMC) where sales were up by 52 per cent MoM due to low base as plant closure amid unavailability of CKD parts resulted in sales of 3,954 units in August 2022.

Indus Motors (INDU) posted decline of 32 per cent MoM to 2,617 units in Sep-2022 from 3,876 units in Aug-2022. Honda Atlas Car (HCAR) also recorded decline of 29 per cent MoM to 1,280 units in Sep-2022 led by decline in sales of BRV by 79 per cent MoM.

Hyundai sales also down 50 per cent MoM to 967 units in September 2022 led by decline in Tuscon sales by 62 per cent MoM.

READ MORE: Toyota unveils all new Crown for first time

Amongst Tractors, Millat Tractors (MTL) recorded decline of 75 per cent MoM and 72 per cent YoY to 638 units due to shutdown of plant for 23 days in September 2022 amid floods. Al Ghazi Tractors (AGTL) recorded sales of 1,511 units, up 6 per cent MoM while down 29 per cent YoY.

Pakistan bike sales were down by 7 per cent MoM and 39 per cent YoY in Sep-2022. Atlas Honda (ATLH) recorded sales of 85K units, flat MoM while down 23 per cent YoY.

Trucks & Buses sales were up 11 per cent MoM while down 25 per cent YoY to 378 units in Sep-2022 primarily due to drop in transportation activities amid floods and slowdown in overall economy.

October 12, 2022

FBR collects Rs196 billion as income tax from salaried class

ISLAMABAD: Federal Board of Revenue (FBR) has collected a huge amount of Rs196.25 billion as income tax from salaried class during tax year 2022.

A report issued by the FBR revealed that the collection of tax on salaried income recorded significant growth of 29 per cent, which compared with the collection of Rs151.84 billion in the preceding tax year.

Salaried tax is major revenue spinner in the collection of withholding tax. The collection of income tax on salaried income has been ranked third in the table of top revenue spinner under the withholding taxes.

The collection of withholding taxes from contracts and imports are on the first two slots. The FBR collected Rs341.42 billion with growth of 25.5 per cent from contracts and Rs281.61 billion with a growth of 29 per cent from imports during tax year 2022.

The recent revision in tax slabs in for the salaried class has been aimed to boost the revenue collection during the current fiscal year 2022/2023.

The FBR said that target for 2022-2023 is challenging given the fact that government is focusing on controlling the current account deficit and rising inflation which would result in import contraction and slowdown in the overall GDP growth.

Nonetheless, FBR is confident that its team has the ability and the resolve to accomplish this gigantic task as an upward revised target has already been achieved for the financial year ended on June 30, 2022.

To achieve the target several efforts are being made at policy as well as operational levels.

“There is focus on enhanced use of technology and a policy shift towards taxing the high-income groups through direct taxation such as the imposition of Super Tax, Poverty Alleviation Tax, revision of individual tax slabs including salaried class, increase in FED on international air travel, increased tax on luxury motor vehicles etc.,” the FBR added.

FOLLOWING IS THE TAX CARD FOR SALARIED PERSONS FOR TAX YEAR 2022-2023

Taxable Income	Rate of Tax
Up to Rs600,000	0%
Rs600,001 –1,200,000	2.5% of amount exceeding Rs600,000
Rs1,200,001 –2,400,000	Rs15,000 + 12.5% of amount exceeding Rs1,200,000
Rs2,400,001 –3,600,000	Rs165,000 + 20% of amount exceeding Rs2,400,000
Rs3,600,001 –6,000,000	Rs405,000 + 25% of amount exceeding Rs3,600,000
Rs6,000,001 –12,000,000	Rs1,005,000 + 32.5% of amount exceeding Rs6,000,000
Amount exceeding Rs12,000,000	Rs2,955,000 + 35% of amount exceeding Rs12,000,000

The rate of tax in the table above are applicable where the income of an individual chargeable under the head ‘salary’ exceeds seventy-five per cent of his/her taxable income.

October 12, 2022

WHT share in direct taxes jumps to 67% despite omitting provisions

ISLAMABAD: Share of withholding tax (WHT) collection in total collection of direct taxes has increased to 67 during Tax Year 2022 despite elimination of many provisions related to the withholding taxes.
(more…)

October 12, 2022
Pakistan amends baggage rules; now $1,000 require declaration

ISLAMABAD: Pakistan has amended baggage rules to make currency declaration of an amount $1,000 while taking out of the country to Afghanistan.

However, new slabs of currency declaration on the basis of age have also been announced.

The Federal Board of Revenue (FBR) issued SRO 1864(I)/2022 dated October 10, 2022 to make changes in the Baggage Rules, 2006.

READ MORE: PTBA raises objections to amendments proposed by FBR

As per the new changes to the baggage rules, the outbound passenger, for all countries except Afghanistan, without prejudice to his entitlement of taking out of Pakistan $1,000 up to the age of 5 years, $5,000 above 5 years, up to 18 years and $10,000 above the age of 18 years, while taking out of Pakistan foreign currency exceeding $5,000 or equivalent, or any other prohibited or restricted item, shall file a declaration before or on departure, electronically in the WeBOC or pass track or manually at the airport.

READ MORE: Pakistan’s tax to GDP ratio improves to 9.2 per cent in FY22: FBR

The FBR said that the persons travelling to Afghanistan, while having entitlement of $1,000, shall file a declaration of currency in their possession.

The incoming passenger when in possession of foreign currency exceeding $10,000 or equivalent, or any other prohibited or restricted item, shall also file a declaration.

READ MORE: Pakistan customs seals over 1,600 illegal petrol pumps during FY22

The FBR said that the declaration is also must for passengers carrying: Prohibited or restricted goods such as arms & ammunitions, narcotics, psychotropic substances or satellite phones etc; and gold and precious metals, jewelry, precious or semi-precious stones.

The declaration of foreign currency in US $/ Bearer Negotiable Instrument or equivalent is mandatory for outbound passengers to all countries except Afghanistan, taking out amount exceeding $5,000 or equivalent;

READ MORE: FBR directs IR offices to avoid recovery in pending appeals

For passengers traveling to Afghanistan, taking out cash foreign currencies US $ or equivalent; and Incoming passengers bringing into Pakistan amount exceeding $ 10,000 or equivalent.

October 12, 2022
Home remittances decline to $7.68 billion in 1QFY23

KARACHI: Inflow of home remittances has slipped by 6.34 per cent to $7.68 billion during first quarter of the current fiscal year 2022-2023, according data released by the State Bank of Pakistan (SBP) on Tuesday.

The inflow of remittances was $8.2 billion in the corresponding quarter of the last year.

READ MORE: Pakistan remittances from Saudi Arabia fall by 7.5% in two months

The data showed that Pakistanis living in Saudi Arabia remitted an amount of $1.89 billion during the first quarter of the current fiscal year as compared with $2.1 billion in the corresponding quarter of the last fiscal year, showing a decline of 10 per cent.

Similarly, the inflow from the UK fell to $1.1 billion during the quarter under review as compared with $1.14 billion in the same quarter of the last fiscal year, showing a decline of 4.2 per cent.

READ MORE: State Bank signs deal to analyze property prices

However, Pakistanis living in the US remitted an amount of $817 million during first quarter of the current fiscal year as compared with $762 million in the corresponding quarter of the last fiscal year, showing an increase of 7.1 per cent.

The inflow of remittances from the UAE recorded a decline of 8.7 per cent to $1.46 billion during the quarter under review as compared with $1.6 billion in the same quarter of the preceding fiscal year.

READ MORE: SBP bars banks from taking service charges on flood donations

The flow of home remittances from the other GCC countries to Pakistan also witnessed a decline of 4.1 per cent to $877 million as compared with $914 million.

Likewise, the inflow from the EU countries recorded a slump of 7.7 per cent to $829 million when compared with $898 million.

READ MORE: Complaints against banks for refusing flood donations

The remittances sent by overseas Pakistanis in the month of September 2022 recorded at $2.44 billion as compared with $2.78 billion in the same month of the last year, showing a decline of 14.07 per cent.

October 12, 2022
PKR maintains winning streak to dollar for 13th straight session

KARACHI: Pakistani Rupee (PKR) continued its winning streak against the US dollar for 13^th straight session on Tuesday.

The exchange rate recorded 18 paisas gain in the rupee value to end at PKR 217.79 from previous day’s closing of PKR 217.97 in interbank foreign exchange market.

READ MORE: Rupee gains for 12th straight session; dollar ends at PKR 217.97

The local currency gained PKR 21.92 against the dollar during the last twelve straight sessions.

The exchange rate reached to near record low of PKR 239.71 on September 22, 2022 to the dollar but ended at PKR 217.79 on October 10, 2022. Dar recently claimed that the actual value of the dollar is below PKR 200 and he vowed to bring it down.

Experts further said that tight monitoring of the State Bank of Pakistan (SBP) on foreign currency transactions helped the rupee to make gain.

READ MORE: Rupee gains for 11th session; dollar falls to PKR 219.92

Recently, the SBP had amended foreign exchange regulations with an objective to promote documentation and transparency in the foreign exchange transactions between exchange companies.

In terms of revised regulations, it has been made mandatory for Exchange Companies, Franchises of Exchange Companies and Exchange Companies of ‘B’ Category to settle Pakistan Rupee consideration of all foreign currency purchase/ sale transactions conducted among themselves through their bank accounts.

Besides, stress has been laid on ensuring that CCTV Systems of Exchange Companies and Exchange Companies of ‘B’ Category should be functional at all times (i.e. 24 hours a day and 7 days a week) as required under existing regulations.

READ MORE: Dollar weakens by PKR 17.77 in 10 sessions amid tight monitoring on transactions

However, in order to ensure transparency, it has been advised that Exchange Companies and Exchange Companies of ‘B’ Category shall not carry out any business activity during the period in which CCTV system is non-functional at any of their outlet for any reason, including technical faults, until the functionality of the CCTV system is restored.

Moreover, minimum preservation period of video recording through CCTV system has been enhanced from two to six months or until the inspection of the company by SBP, whichever is earlier.

READ MORE: PKR recovers against dollar for ninth consecutive session

This would ensure availability of CCTV recording for audit/inspection purposes, according to the SBP.

Meanwhile, the international oil prices also softened which helped the rupee to make gains.

The local currency witnessed the historic low at PKR 239.94 to the dollar on July 28, 2022.

October 11, 2022