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  • Tax rates on profit from bank deposits during year 2022/2023

    Tax rates on profit from bank deposits during year 2022/2023

    Federal Board of Revenue (FBR) has issued latest tax rates on profit from bank deposits derived during the year 2022/2023.

    The FBR issued the withholding tax card for tax year 2023 (July 01, 2022 to June 30, 2023) after amending the Income Tax Ordinance, 2001 through changes brought through Finance Act, 2022.

    The FBR collects tax on profit on debt under section 151 of the Income Tax Ordinance, 2001. It issued the rates applicable for both persons on the Active Taxpayers List (ATL) and those who are not on the ATL.

    According the latest rates, 15 per cent of the tax is applicable on the persons who are on the ATL and 30 per cent is to be paid by persons not on the ATL while receiving profit on debt falling under clause (a), (b), (c) or (d) of Sub-Section 1 of the Section 151.

    The clauses a, b, c and d of the sub-section 1 of section 151 are:

    (a) a person pays yield on an account, deposit or a certificate under the National Savings Scheme or Post Office Savings Account;

    (b) a banking company or financial institution pays any profit on a debt, being an account or deposit maintained with the company or institution;

    (c) the Federal Government, a Provincial Government or a Local Government pays to any person profit on any security other than that referred to in clause (a) issued by such Government or authority; or

    (d) a banking company, a financial institution, a company referred to in sub-clauses (i) and (ii) of clause (b) of sub-section (2) of section 80, or a finance society pays any profit on any bond, certificate, debenture, security or instrument of any kind (other than a loan agreement between a borrower and a banking company or a development finance institution) to any person other than financial institution.

    The FBR further noted that profit on debt on Sukuk by SPV or a company under sub-section (1A) of Section 151 of Income Tax Ordinance, 2001, the withholding tax rates shall be as follow:

    — Company in case of ATL 25 per cent and non-ATL 50 per cent.

    — Individual, Association of Person (AOP) return above Rs 1 million the tax rate for ATL shall be 12.5 per cent and in case of non-ATL the tax rate shall be 25 per cent.

    — Individual, AOP return below one million rupees the tax rate shall be 10 per cent for ATL and in case of non-ATL the tax rate shall be 20 per cent.

    The Sub-Section (1A) of Section 151 of the Income Tax Ordinance, 2001, is:

    (1A) Every special purpose vehicle or a company, at the time of making payment of a return on investment in Sukuks to a Sukuk holder shall deduct tax from the gross amount of return on investment at the rate specified in Division IB of Part III of the First Schedule.

    READ MORE: Up to 70% income tax imposed on dividends for year 2022-2023

    READ MORE: FBR updates salary tax card for year 2022-2023

    READ MORE: FBR issues withholding tax rates on imports for tax year 2022-2023

  • Last date for return filing will not be extended: FBR

    Last date for return filing will not be extended: FBR

    ISLAMABAD: Federal Board of Revenue (FBR) on Monday said it will not extend the last date for filing income tax returns beyond September 30, 2022.

    The FBR sent SMS to taxpayers advising them to file their return of income for the tax year 2022 at the earliest. “The last date to file return is September 30, 2022, which will not be extended,” it added.

    READ MORE: Last date for filing tax return is September 30, FBR reminds

    The revenue body recently launched a campaign to motivate people for filing income tax returns. The FBR said: “Like every year before, the FBR launched a comprehensive awareness campaign to maximize its outreach through electronic and print media, urging taxpayers both existing and new, to file Income Tax Returns on time. The last date to file returns is September 30, 2022.”

    The FBR issued an alert about the last date stating that last date to file income tax returns will not be extended. “Last date to file income tax returns for individuals and association of persons (AOPs) is September 30, 2022,” the FBR added.

    READ MORE: Disclosure of beneficial ownership made mandatory for companies

    The revenue body said that income tax returns can be filed through: Tax Asaan APP and FBR website.

    It further stated that tax payment is possible through: internet and mobile banking; credit card and ATMs; cash and bank account.

    The FBR further urged the taxpayers to file tax returns and avail exemption from 100 per cent increased withholding tax rates.

    The tax body highlighted mandatory income tax return filing for persons and corporate entities.

    The FBR said that all resident persons registered with professional bodies, i.e. chamber of commerce, Pakistan Bar Council or Market Committee etc. are required to file income tax returns.

    READ MORE: KTBA highlights pharmaceutical industry’s reporting issues

    Association of persons and Individuals having more than Rs400,000 annual business income are also required to file their return of income on annual basis.

    “The income tax return filing is must for salaried persons if annual income exceeds Rs600,000,” the FBR added.

    The revenue body said that the income tax return filing for tax year 2022 is also mandatory for persons who were charged to income tax in tax years 2020 and Tax Tear 2021.

    Furthermore following persons are required to file income tax return:

    — Persons having National Tax Number (NTN)

    — Persons who own a motor vehicle having engine capacity more than 1,000CC

    — Persons who own 500 sq. yards or more property / flat in urban areas.

    READ MORE: FBR directs speedy clearance of flood relief goods

    — Owners of flat with 2,000 sq. feed covered area of 500 sq. yards or more land in FBR rating area.

    — All Non for Profit Organizations (NPOs) or welfare organizations that fall under Income Tax Ordinance, 2001.

    — Commercial and Industrial consumers paying more than Rs500,000 electricity bill annually.

    — Resident persons required to file foreign income and assets statement.

  • PKR plunges for 12th session; Dollar ends at PKR 237.91

    PKR plunges for 12th session; Dollar ends at PKR 237.91

    KARACHI: Pakistani Rupee (PKR) plunged for 12th consecutive session against the dollar on Monday to end at PKR 237.91 in the interbank foreign exchange market.

    The exchange rate witnessed a decline of PKR 1.07 in rupee value to end at PKR 237.91 as compared with last Friday’s closing of PKR 236.84 in the interbank foreign exchange market.

    READ MORE: Dollar rallies for 11th straight session; ends PKR 236.84 at interbank

    The local currency recorded a decline of Rs19.31 or 8.83 per cent during the past 12 sessions from Rs218.60 against the dollar on September 01, 2022.

    Currency experts said that mounting dollar demand for import and corporate payments was pressurizing the local currency.

    Furthermore, the political uncertainty is also destabilizing the local unit against the greenback.

    It is worth mentioning that the rupee recorded all-time low of Rs239.94 on July 28, 2022.

    The rupee failed to get support from the latest announcement of the State Bank of Pakistan (SBP) about the funds of Saudi Arabia.

    READ MORE: Rupee devaluation continues; Dollar jumps to PKR 235.88

    Saudi Fund for Development (SFD) has confirmed rollover of $3 billion deposit maturing on December 05, 2022 for one year. Deposit is placed with SBP and is part of its forex reserves. This reflects continuing strong and special relationship between KSA and Pakistan, according to the SBP.

    The rupee has witnessed a continuous depreciation against the greenback even after the inflows received from the International Monetary Fund (IMF).

    READ MORE: Pakistani Rupee declines for ninth straight session; Dollar ends at PKR 234.32

    The rupee made some recovery against the greenback after the IMF fund was transferred to the State Bank of Pakistan (SBP). However, the removal of sanction on import of luxury and non-essential items the rupee again started free fall.

    The currency experts said that although the IMF inflows would help the further inflows under bilateral and multilateral sources. However, the devastation of floods has changed the economic environment scenario.

    READ MORE: Dollar surges to PKR 233.50 in midday interbank on September 14, 2022

    The torrential rains and flash floods have inflicted a loss of over $10 billion to Pakistan’s economy. The devastation will prompt the country to make imports in the coming days, especially for agriculture products.

    The rupee also fell due to continuous depletion in foreign exchange reserves of the country.

  • OGDCL discovers gas deposits at Kohat District

    OGDCL discovers gas deposits at Kohat District

    KARACHI: Oil and Gas Development Company Limited (OGDCL) on Monday announced discovery of gas deposits at district Kohat in the province of Khyber Pakhtunkhwa.

    The company sent a communication to the Pakistan Stock Exchange (PSX) stated that the TAL Joint Venture comprising MOL Pakistan Oil & Gas Co. B. V. (Operator), OGDCL (30 per cent working interst exploratory phase), Pakistan Petroleum Limited (PP), Pakistan Oilfields Limited (POL) and Government Holdings Private limited (GHPL) had discovered gas condensate from Lockhart formation in Tolanj West-2 development well located in district Kohat, Khyber Pakhtunkhwa Province.

    READ MORE: Latest petroleum prices in Pakistan

    It said that the well was spudded-in on April 10, 2022 to produce Hydrocarbon from already discovered horizon of Tolanj West D&PL i.e. Lumshiwal Formation and to test Hydrocarbon potential of Lockhart & Shinwari & Samanasuk Formations (as exploratory targets). The well has been successfully drilled down to depth of 4119.34m TVD.

    READ MORE: Techaccess Pakistan hosts session on in power sector cybersecurity

    Based on interpretation results of wireline logs data, Lockhart Formation (Exploratory Target) was tested successfully at rate of around 8.3 Million Standard Cubic Feet Per Day (MMSCFD) gas and 34 barrels per day (BPD) of condensate at choke size 32/64” at Wellhead Flowing Pressure (WHFP) of 1285 Pounds per Square Inch (Psi).

    READ MORE: Lucky Cement installs 25.3 MW solar energy plant at Karachi

    “The new discovery has de-risked further exploration play in TAL Block, leading to new upside opportunities,” OGDCL said, adding that the said discovery will also help and contributed towards improving energy security of the country from indigenous resources and add to the hydrocarbon reserve base of the company, its joint venture partners and the country.

    READ MORE: Mari Petroleum stops production from Zarghun, Bolan fields

  • Dollar surges to PKR 238 at midday interbank

    Dollar surges to PKR 238 at midday interbank

    KARACHI: The US dollar surged to Pakistani Rupee (PKR) at 238 at midday interbank foreign exchange market on Monday.

    The foreign currency started the week to continue the gaining momentum of past 11 sessions against the local currency.

    READ MORE: Dollar rallies for 11th straight session; ends PKR 236.84 at interbank

    US dollar made so far another PKR 1.16 to trade at PKR 238 from last Friday’s closing of PKR 236.84 in the interbank foreign exchange market.

    Currency experts said that the falling foreign exchange reserves and high import payment pressured the local currency.

    READ MORE: Rupee devaluation continues; Dollar jumps to PKR 235.88

    They said that usually dollar demand remained higher by end of each quarter due to oil payments and demand from corporate sector.

    Furthermore, they said that the recent statement of Finance Minister Miftah Ismail regarding lack of inflows from friendly countries also sent disappointments to the currency market.

    It is worth mentioning that the rupee recorded all-time low of Rs239.94 on July 28, 2022.

    READ MORE: Pakistani Rupee declines for ninth straight session; Dollar ends at PKR 234.32

    The rupee has witnessed a continuous depreciation against the greenback even after the inflows received from the International Monetary Fund (IMF).

    The rupee made some recovery against the greenback after the IMF fund was transferred to the State Bank of Pakistan (SBP). However, the removal of sanction on import of luxury and non-essential items the rupee again started free fall.

    READ MORE: Dollar surges to PKR 233.50 in midday interbank on September 14, 2022

    The currency experts said that although the IMF inflows would help the further inflows under bilateral and multilateral sources. However, the devastation of floods has changed the economic environment scenario.

    The torrential rains and flash floods have inflicted a loss of over $10 billion to Pakistan’s economy. The devastation will prompt the country to make imports in the coming days, especially for agriculture products.

    The rupee also fell due to continuous depletion in foreign exchange reserves of the country.

  • President Alvi bars retrospective effect to profit rates on saving certificates

    President Alvi bars retrospective effect to profit rates on saving certificates

    ISLAMABAD: The President of Pakistan Dr. Arif Alvi, while rejecting the retrospective effect of government decision, has directed the authorities to pay profit rate on saving certificates on prevailing rates.

    While accepting a representation of an aggrieved citizen against a decision of the Wafaqi Mohtasib, President Dr Arif Alvi has directed the Central Directorate of National Savings (CDNS) to pay profit on the Special Saving Certificates (SSCs) as per the profit rate prevailing at the time of purchasing the certificates.

    READ MORE: President Alvi directs State Life Insurance to pay compensation

    He said that CDNS had committed maladministration by revising the profit rates retrospectively and in contrary to the existing law, thus causing the citizen a loss of Rs 5.3 million.

    The President issued these directions while deciding on a representation preferred by Ms Yasmeen Merchant, who had purchased six SSCs from CDNS on 01.11.2019 at a profit rate of 12.7 per cent for five certificates and 13.9 per cent profit rate for the sixth certificate.

    READ MORE: President Alvi rejects Habib Bank plea, orders to pay victims

    Four days later on 05.11.2019, however, Finance Division issued a notification reducing the profit rates from 12.7 per cent to 11 per cent and 13.9 per cent to 11.8 per cent with retrospective effect from 01.11.2019, causing her a loss of Rs 5.3 million.

    The President accepted her representation and held that the complainant was entitled to the profit rate prevailing on the date of issuance of certificates and that the change made through the notification did not apply to her investment in retrospective and, therefore, it could not affect her duly earned right of profit nor it can nullify it to her disadvantage.

    READ MORE: HBL ordered to compensate bank fraud victim

    He said that the notification issued was in the nature of subordinate or delegated legislation and took effect from the date of its publication in the official Gazette and not from any prior date.

    The President added that the rationale behind it was that only the Parliament/legislative bodies could enact a law from a date prior to its enactment i.e., retrospectively and the Government by itself, unless authorized by the statute, had no such authority or power to issue a notification operative from a date different from the date of its publication in the official Gazette.

    READ MORE: FBR directed to bring entire sugar supply chain into tax net

    The President further highlighted that a person may feel allured by the incentives floated by the Government and act upon it, and it did not behove the Government to recant on its commitment as it may erode the confidence of the general public in the government bodies and may also negatively affect the credibility of the Government.

    He further stated that such law was based on settled legal principles and Quranic injunctions as per the 1st verse of Surah Al-Maida “O ye who believe! Fulfil your undertakings”.

    The President held that it was not only logical, fair and just to fulfil promises, undertakings and agreements but was also a universally accepted norm. He further declared that both sides were bound by the commitments made at the time of issuance of certificates and directed CDNS to pay the profit as per the promised profit rates of 12.7 per cent and 13.9 per cent on the purchased certificates.

    As per details, the citizen’s grievance was that she had purchased the SSCs because of the prevailing profit rate whereas the notification gave retrospective effect to the profit rates and was issued after investment to her disadvantage.

    She approached CDNS and later the Wafaqi Mohtasib for redressal of her grievance but to no avail. She then filed a representation with the President, which he accepted.

  • PTA warns internet users of death punishment for blasphemy

    PTA warns internet users of death punishment for blasphemy

    The Pakistan Telecommunication Authority (PTA) issued a stern warning on Sunday, cautioning internet users of severe penalties, including death, for blasphemy.

    (more…)
  • Dollar rallies for 11th straight session; ends PKR 236.84 at interbank

    Dollar rallies for 11th straight session; ends PKR 236.84 at interbank

    KARACHI: The US Dollar made gain for 11th straight day against Pakistani Rupee (PKR) to reach 236.84 at closing of interbank foreign exchange market on Friday.

    The exchange rate recorded a decline of 96 paisas in rupee value to end at Rs236.84 to the dollar from previous day’s closing of Rs235.88 in the interbank foreign exchange market.

    READ MORE: Rupee devaluation continues; Dollar jumps to PKR 235.88

    The local currency recorded a decline of Rs18.24 or 8.34 per cent during the past 11 sessions from Rs218.60 against the dollar on September 01, 2022.

    Currency experts said that mounting dollar demand for import and corporate payments was pressurizing the local currency.

    Furthermore, the political uncertainty is also destabilizing the local unit against the greenback.

    It is worth mentioning that the rupee recorded all-time low of Rs239.94 on July 28, 2022.

    READ MORE: Pakistani Rupee declines for ninth straight session; Dollar ends at PKR 234.32

    The rupee has witnessed a continuous depreciation against the greenback even after the inflows received from the International Monetary Fund (IMF).

    The rupee made some recovery against the greenback after the IMF fund was transferred to the State Bank of Pakistan (SBP). However, the removal of sanction on import of luxury and non-essential items the rupee again started free fall.

    READ MORE: Dollar surges to PKR 233.50 in midday interbank on September 14, 2022

    The currency experts said that although the IMF inflows would help the further inflows under bilateral and multilateral sources. However, the devastation of floods has changed the economic environment scenario.

    The torrential rains and flash floods have inflicted a loss of over $10 billion to Pakistan’s economy. The devastation will prompt the country to make imports in the coming days, especially for agriculture products.

    The rupee also fell due to continuous depletion in foreign exchange reserves of the country.

    READ MORE: PKR losing streak continues; Dollar ends Rs231.92 at interbank

  • Latest petroleum prices in Pakistan

    Latest petroleum prices in Pakistan

    ISLAMABAD: Pakistan was scheduled to review the petroleum prices on September 15, 2022. The revision in prices requires approval from the prime minister, who is attending two-day conference of Shanghai Cooperation Organization (SCO).

    There is no official announcement in this regard or delay in updating the prices of petroleum products.

    READ MORE: New petroleum prices in Pakistan from September 01, 2022

    The latest prices of petroleum products in Pakistan, which was implemented on September 01, 2022 were:

    The price of petrol has been increased by Rs2.07 per liter to Rs235.98 from Rs233.91.

    The price of high speed diesel has been increased by Rs2.99 per liter to Rs247.43 from Rs244.44.

    The rate of kerosene oil has been raised by Rs10.92 per liter to Rs210.32 from Rs199.40.

    The price of light diesel oil has been increased by Rs9.79 per liter to Rs201.54 from Rs191.75.

    The country reviews domestic oil prices after every 15 days to adjust rise and fall of prices in the international market and changes occurred in the exchange rates.

    Experts believe that Pakistan may increase the petroleum prices for the fortnight because of massive decline in rupee value during past 15 days besides the expected imposition of sales tax and further increase in petroleum levy.

    READ MORE: Pakistan to increase petroleum prices from September 01, 2022

    The government on August 31, 2022 decided to increase the prices of petroleum products effective from September 01, 2022. The decision was strongly criticized by the stakeholders because the international markets had seen fall in oil prices.

    Pakistan is a net importer of petroleum products so huge foreign exchange is required for paying against foreign purchases and meeting local demand.

    The country has spent a staggering amount of $23.32 billion for the import of petroleum group during fiscal year 2021/2022 as compared with $11.36 billion in preceding year, showing a growth of 105 per cent. The import of finished products recorded an increase of 134 per cent to $12.07 billion during the fiscal year 2021/2022 as compared with $5.16 billion in the preceding fiscal year.

    The benchmark Brent crude is below $100 dollars. Brent crude futures were at $92.84 per barrel in New York trade on September 09, 2022.

    READ MORE: New petroleum prices in Pakistan from August 16, 2022

    The present government had started increasing the petroleum prices on May 26, 2022 when the benchmark Brent Oil was at $112 per barrel.

    Considering the price slump of international oil, the government had reduced the prices of petroleum products from July 15 to July 31. However experts believed it was a political decision as the government had to increase petroleum levy and apply sales tax.

    The previous government of PTI had kept both the petroleum levy and sales tax at zero in order to provide relief to the masses. The PTI government also provided a huge subsidy on prices of petroleum products in order to lower the rates and provide relief to the masses.

    However, former Prime Minister Imran Khan was removed through a vote of no-confidence motion on April 10, 2022. Since then the new coalition government led by PML-N increased the prices of petroleum products sharply on three different occasions.

    The present government in the budget estimated to collect Rs855 billion as petroleum levy during the fiscal year 2022/2023. As this fiscal year is starting from July 01, 2022, it is likely that the government will opt to impose the levy from this date.

    The exchange rate has seen massive decline in rupee value during past week despite inflows received from the International Monetary Fund (IMF).

    READ MORE: New petroleum prices in Pakistan from August 1, 2022

    Pakistani Rupee (PKR) has plunged by Rs9.43 against the US dollar since the country received tranche from the International Monetary Fund (IMF). The country received a tranche of $1.16 billion from the IMF under Extended Fund (EFF) loan program on August 31, 2022.

    The government was hopeful of improvement in economic indicators once the money is received from the IMF. However, in contrast the PKR fell sharply since the IMF funds transferred to the State Bank of Pakistan (SBP).

    The exchange rate was Rs218.75 to the dollar on August 31, 2022, the day when the money was received by Pakistan. However, since then the rupee fell by Rs9.43 or 4.31 per cent to Rs228.18 to the dollar on September 09, 2022 in interbank foreign exchange market.

  • Dollar rises to PKR 236.50 in midday interbank trading

    Dollar rises to PKR 236.50 in midday interbank trading

    KARACHI: The US dollar continued to rise on Friday and went to Pakistani Rupee (PKR) 236.50 during midday interbank foreign exchange market.

    The exchange rate witnessed a decline of 62 paisas in rupee value to reach Rs236.50 to the dollar during intraday trading from previous day’s closing of Rs235.88 in the interbank foreign exchange market.

    READ MORE: Rupee devaluation continues; Dollar jumps to PKR 235.88

    Currency experts said that lack of dollar inflows pressurized the rupee. They said that the reports of delay or no inflows from friends of Pakistan further created panic in the currency market.

    On September 15, 2022, the local currency recorded a decline of Rs16.08 or 8 per cent during the past 10 sessions from Rs218.60 against the dollar on September 01, 2022.

    The experts said that mounting dollar demand for import and corporate payments was pressurizing the local currency.

    READ MORE: Pakistani Rupee declines for ninth straight session; Dollar ends at PKR 234.32

    Furthermore, the political uncertainty is also destabilizing the local unit against the greenback.

    It is worth mentioning that the rupee recorded all-time low of Rs239.94 on July 28, 2022.

    The rupee has witnessed a continuous depreciation against the greenback even after the inflows received from the International Monetary Fund (IMF).

    READ MORE: Dollar surges to PKR 233.50 in midday interbank on September 14, 2022

    The rupee made some recovery against the greenback after the IMF fund was transferred to the State Bank of Pakistan (SBP). However, the removal of sanction on import of luxury and non-essential items the rupee again started free fall.

    The currency experts said that although the IMF inflows would help the further inflows under bilateral and multilateral sources. However, the devastation of floods has changed the economic environment scenario.

    READ MORE: PKR losing streak continues; Dollar ends Rs231.92 at interbank

    The torrential rains and flash floods have inflicted a loss of over $10 billion to Pakistan’s economy. The devastation will prompt the country to make imports in the coming days, especially for agriculture products.

    The rupee also fell due to continuous depletion in foreign exchange reserves of the country.