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  • Dollar climbs to PKR 221.50 on rising political tension

    Dollar climbs to PKR 221.50 on rising political tension

    KARACHI: The US dollar on Wednesday climbed up by 82 paisas against the Pakistani Rupee to PKR 221.50 owing to rising political tension in the country.

    The exchange rate ended with a decline of 82 paisas in rupee value to end at PKR 221.50 to the dollar from previous day’s closing of PKR 220.68 in the interbank foreign exchange market.

    READ MORE: Rupee slips sharply to dollar on PTI long march

    Currency experts said that the announcement of the longa march by Pakistan Tehreek I Insaaf (PTI) had shaken investors’ confidence.

    PTI Chief Imran Khan two days back announced long march against the present government. He announced the rally would begin from Friday October 28, 2022 for an indefinite period.

    Since the announcement of country-wide protest rally the rupee fell PKR 1.77 against the dollar.

    PTI Chief Imran Khan was removed as prime minister through a vote of no confidence by the allied political parties in April this year. Imran Khan claimed that his government was toppled by a conspiracy.

    READ MORE: Rupee recovers to PKR 219.73 against dollar

    Prior to the announcement of the long march, the rupee witnessed recovery against the greenback due to removal of Pakistan name from the grey list of the Financial Action Task Force (FATF).

    Further, the sentiments were also improved due to commitment of Asian Development Bank (ADB) to finance the country. The ADB approved a financing of $1.5 billion to the country. Currency experts said that the approval of loan program by the ADB helped the rupee to make gain.

    Interestingly, the amount of $1.5 billion was received last night by the State Bank of Pakistan (SBP). However, the fund transfer also failed to support the local currency.

    READ MORE: Dollar slips to PKR 220.41 on improved economic sentiments

    Previously, the rupee was also supported by contraction in current account deficit during the first quarter of the current fiscal year.

    Pakistan’s current account deficit has recorded a decline of 37 per cent to $2.21 billion during first quarter (July – September) of fiscal year 2022/2023, according to official data released last week.

    The current account deficit of the country was $3.53 billion in the same quarter of the last fiscal year.

    READ MORE: Rupee gains 11 paisas to dollar on ADB loan approval

    Contraction in current account deficit can be attributed to significant fall in trade deficit. The trade deficit also contracted by 21.32 per cent to $9.22 billion during first quarter of the current fiscal year as compared with the deficit of $11.72 billion in the same quarter of the last fiscal year.

    Furthermore, the local currency also received support as the level of foreign exchange reserves were remained flat.

    Pakistan’s weekly foreign exchange reserves increased nominally to $13.251 billion by week ended October 14, 2022 as compared with $13.247 billion a week ago i.e. October 7, 2022.

  • OGDCL announces huge oil discovery at Attock

    OGDCL announces huge oil discovery at Attock

    KARACHI: Oil and Gas Development Company Limited (OGDCL) on Thursday announced huge oil discovery at Attock District, Punjab Province, Pakistan.

    The company shared the information of oil discovery with the Pakistan Stock Exchange (PSX) and London Stock Exchange.

    READ MORE: OGDCL discovers gas deposits at Kohat District

    In its communication, the company said that OGDCL being operator of Toot Mining Lease with 100 per cent working interest has made oil discovery from Lockhart Formation at Toot Deep-1 well which is located in Attock District, Punjab province, Pakistan.

    READ MORE: Latest petroleum prices in Pakistan

    Toot Deep # 01 well was spudded-in on December 25, 2022 and successfully drilled down to total depth at 5545 meters in Tobra Formation. Based on interpretation results of open hole logs data, Lockhart Formation has successfully tested oil at the rate of 882 Barrel per day and 0.93 million standard cubic feet per day (MMSCFD) gas at well head flowing pressure (WHFP) of 600 pounds per square inch (psi) at 32/64” choke size.

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

    “This discovery has further extended the hydrocarbon play area in Pothohar basin, OGDCL being leading exploration and production company in Pakistan has adopted aggressive exploration strategies which has resulted in hydrocarbon discoveries.”

    This discovery will add to the hydrocarbons reserves base of OGDCL and contribute positively towards oil and natural gas production from indigenous resources of Pakistan, the company added.

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

  • SBP receives $1.5 billion from Asian Development Bank

    SBP receives $1.5 billion from Asian Development Bank

    State Bank of Pakistan (SBP) on Wednesday night said it received $1.5 billion from Asian Development Bank (ADB) as disbursement of policy based loan for Pakistan.

    In a Tweet on Wednesday late night, the central bank said that it had received $1.5 billion from the ADB in value October 26, 2022 as disbursement of policy based loan for the government of Pakistan.

    “These proceeds have increased the foreign exchange reserves of SBP and will be reflected in the reserves for the week ending October 28, 2022,” it added.

    READ MORE: Asian Bank approves $1.5 billion to finance Pakistan

    Earlier an official statement revealed that the ADB released $1.5 billion to the SBP under Building Resilience Under Active Countercyclical Expenditures (BRACE) Program.

    The BRACE program aims to support the government’s efforts to deal with the adverse impacts of devastating floods, supply chain disruptions, rising energy, fuel prices and inflation on the poor and vulnerable.

    READ MORE: FATF removes Pakistan from grey list

    It would expand the number of families receiving cash transfers through Benazir Income Support Programme (BISP) from 7.9 million to 9 million, increase the number of children enrolled in primary and secondary schools, and enhance geographic coverage of health services and nutritional supplies for pregnant and lactating mothers and children under 2 years old.

    The program is completely aligned with the Government’s strategy to provide targeted and temporary countercyclical relief measures.

    The facility aims to support deployment of planned countercyclical development expenditure and will promote sound macroeconomic management.

    READ MORE: Foreign direct investment in Pakistan plunges by 47% in 1QFY23

    The program is also in line with the framework of ongoing International Monetary Fund (IMF) program to implement necessary structural reforms to improve the country’s macroeconomic prospects.

    It will also enhance support for business entities to safeguard employment and would help increasing food security measures as well. Furthermore, it will also strengthen social safety net and fiscal measures for the government’s crisis response.

    The BRACE program amounting to US$ 1.5 billion was approved by the ADB Board on Friday, 21st October 2022.

    This program was initially conceived and approved by the ADB’s Board in May 2022 under a new Countercyclical Support Facility (CSF) to provide targeted support to its developing member countries (DMCs) facing emergency situations.

    READ MORE: Pakistan’s weekly forex reserves increase nominally

    The signing ceremony of the BRACE Program was held on 24th October 2022 at Prime Minister House, which was witnessed by the Prime Minister of Pakistan, Federal Minister for Economic Affairs, Sardar Ayaz Sadiq, Federal Minister for Finance and Revenue, Senator Ishaq Dar along with Director General ADB Central and West Asia Department.

  • Pharma industry agrees to provide paracetamol at reduced prices

    Pharma industry agrees to provide paracetamol at reduced prices

    ISLAMABAD: Federal Minister Senator Mohammad Ishaq Dar on Wednesday said that the pharma industry agreed to provide paracetamol products at reduced prices.

    He said this during a meeting with heads of pharmaceutical companies involved in the production of paracetamol products, a Finance Ministry press release said. The meeting was also attended by the SAPM on Finance Tariq Bajwa.

    READ MORE: Manufacturing Panadol on negative margins unsustainable: GSK Pakistan

    The meeting reviewed the maximum retail price and shortage of paracetamol products in the country and discussed modalities for smooth supply and availability of paracetamol products in the markets at affordable rate.

    It was informed that rising import prices of pharmaceutical raw materials and increasing production costs are increasing the shortage of essential medicines in the market.

    The pharmaceutical heads demanded a high increase in the prices of paracetamol products to overcome the shortage.

    READ MORE: GSK confirms raid related to Panadol shortage

    In order to resolve the issue of shortage of paracetamol products and to support local manufacturers, the chair discussed in details with the stakeholders and following reduced prices of paracetamol products have been agreed upon by the Pharma industry against their demanded prices.

    The production of Paracetamol products has been started by the Pharmaceutical manufacturers.

    The Pharma industry agreed upon the reduced prices of paracetamol (plain) 500 mg tablet at Rs 2.35; paracetamol (extra) 500mg at Rs. 2.75 and Syrup at Rs. 117.6, which is almost half of the price increase demanded by them.

    The Pharma industry demanded the prices of paracetamol (plain) 500 mg tablet at Rs 2.67; paracetamol (extra) 500mg at Rs. 3.32 and Syrup at Rs. 117.6.

  • Rupee slips sharply to dollar on PTI long march

    Rupee slips sharply to dollar on PTI long march

    KARACHI: Pakistani Rupee (PKR) slipped by sharp 95 paisas against the US dollar on Wednesday owing to unstable political situation after a long march announced by PTI Chief Imran Khan.

    Exchange rate recorded 95 paisas decline in rupee value to end at PKR 220.68 from previous day’s closing of PKR 219.73 in the interbank foreign exchange market.

    READ MORE: Rupee recovers to PKR 219.73 against dollar

    Currency experts said that the market participants were in panic after expected political instability in the country.

    PTI Chief Imran Khan a day earlier announced a country-wide protest with a long march towards the federal capital Islamabad. He announced the rally would begin from Friday October 28, 2022 for an indefinite period.

    READ MORE: Dollar slips to PKR 220.41 on improved economic sentiments

    PTI Chief Imran Khan was removed as prime minister through a vote of no confidence by the allied political parties in April this year. Imran Khan claimed that his government was toppled by a conspiracy.

    Prior to the announcement of the long march, the rupee witnessed recovery against the greenback due to removal of Pakistan name from the grey list of the Financial Action Task Force (FATF).

    Further, the sentiments were also improved due to commitment of Asian Development Bank (ADB) to finance the country. The ADB approved a financing of $1.5 billion to the country. Currency experts said that the approval of loan program by the ADB helped the rupee to make gain.

    READ MORE: Rupee gains 11 paisas to dollar on ADB loan approval

    The ADB in a statement on Friday said that it had approved $1.5 billion in financing to help the Government of Pakistan provide social protection, promote food security, and support employment for its people amid devastating floods and global supply chain disruptions.

    Besides, the rupee was also supported by contraction in current account deficit during the first quarter of the current fiscal year.

    Pakistan’s current account deficit has recorded a decline of 37 per cent to $2.21 billion during first quarter (July – September) of fiscal year 2022/2023, according to official data released last week.

    The current account deficit of the country was $3.53 billion in the same quarter of the last fiscal year.

    READ MORE: Dollar inches up to end at PKR 220.95 in interbank market

    Contraction in current account deficit can be attributed to significant fall in trade deficit. The trade deficit also contracted by 21.32 per cent to $9.22 billion during first quarter of the current fiscal year as compared with the deficit of $11.72 billion in the same quarter of the last fiscal year.

    Furthermore, the local currency also received support as the level of foreign exchange reserves were remained flat.

    Pakistan’s weekly foreign exchange reserves increased nominally to $13.251 billion by week ended October 14, 2022 as compared with $13.247 billion a week ago i.e. October 7, 2022.

  • Last date extended for exchanging bearer prize bonds to June 30, 2023

    Last date extended for exchanging bearer prize bonds to June 30, 2023

    ISLAMABAD: The federal government on Tuesday announced to extend the last date for exchanging / converting the bearer prize bonds up to June 30, 2023.

    The bearer prize bonds with denominations of Rs40,000/-, Rs25,000/-, Rs15,000/ and Rs7,500 were expired on June 30, 2022. However, there is huge amount unclaimed against these bearer bonds and people complained for not providing sufficient time for exchanging the bonds.

    READ MORE: Pakistan-issued prize bonds expire on June 30, 2022

    The finance division through various notifications notified the date extension up to June 30, 2023 for the bearer prize bonds.

    The finance ministry launched the withdrawal of the unregistered prize bonds in a phased manner. The federal government on June 24, 2019, announced to discontinue the circulation of Rs40,000 denomination national prize bonds. Similarly, on December 10, 2020, the government announced to discontinue the circulation of Rs25,000 denomination prize bonds. In April 2021, the finance ministry announced that national prize bonds of denominations Rs7,500 and Rs15,000 shall not be sold.

    READ MORE: SBP directs banks to accept bearer prize bonds

    Since June 2019 the government repeatedly extended the date for exchanging the bearer bonds. Previously, the last date for exchanging the unregistered bonds was December 31, 2021.

    The government is aiming to document the bearer bonds so the exchanging the unregistered bond with cash has been prohibited. The ministry of finance issued various procedure to convert the bond without exchanging with the cash.

    READ MORE: Prize bond (bearer) holders given 3 months to document

    The bonds can be converted to premium prize bonds (registered) of denomination of Rs25,000 and Rs40,000 (subject to the adjustment of differential amount) through 16 field offices of State Bank of Pakistan (SBP) Banking Services Corporation (BSC), and branches of six commercial banks i.e. National Bank of Pakistan, Habib Bank Limited, United Bank Limited, MCB Bank Limited, Allied Bank Limited, and Bank Alfalah Limited.

    READ MORE: History of Prize Bonds in Pakistan

    The bonds can be replaced with Special Saving Certificates/Defence Saving Certificates through the 16 field offices of SBP Banking Services Corporation, authorized commercial banks, and the National Savings Center.

    The bonds will only be encashed by transferring the proceeds to the bonds holder’s bank account through the 16 field offices of SBP BSC as well as the authorized commercial bank branches and to the Saving Accounts at National Savings Centers.

  • Prime Minister Shehbaz arrives Saudi Arabia to attend FII Summit

    Prime Minister Shehbaz arrives Saudi Arabia to attend FII Summit

    RIYADH: Prime Minister Shehbaz Sharif on Monday arrived Riyadh, Saudi Arabia on a two-day visit to attend the Future Investment Initiative (FII) Summit being held from October 25-27, 2022.

    The prime minister is visiting the Kingdom at the invitation of Saudi Crown Prince Mohammed Bin Salman bin Abdulaziz.

    At the airport, the Governor of Riyadh Faisal bin Bandar bin Abdulaziz Al Saud received the prime minister who was accompanied by a delegation comprising the federal ministers.

    READ MORE: Prime Minister Shehbaz wishes Hindu community on Diwali

    During his stay in Riyadh, the prime minister will hold consultations with the Saudi Crown Prince to review the longstanding fraternal relations, with a view to further strengthening the multifaceted cooperation, especially in the economic field, according to the Foreign Office.

    Prior to his departure, the prime minister in a series of tweets said the present state of the global economy needed “new thinking and bold vision to overcome the irritants and forge new paths”.

    “The pandemic and climate-induced disasters have already put immense strains on the developing countries,” he said, adding that it was high time the world explored solutions to the deepening challenges through candid dialogue.

    The FII summit will convene the world’s foremost CEOs, policymakers, investors, entrepreneurs, and young leaders to shape the future of international investment and the global economy.

    The event will include in-depth conversations about new pathways for global investment; analysis of critical industry trends; and unparalleled networking among CEOs, world leaders, and experts.

  • No audit of IT sector due to fixed tax regime: FBR chairman

    No audit of IT sector due to fixed tax regime: FBR chairman

    ISLAMABAD: Asim Ahmad, Chairman, Federal Board of Revenue (FBR) on Monday said there is no audit of the IT sector due to fixed tax regime.

    There is no audit of IT sector export-oriented companies through budgetary measures in the current financial year for ensuring ease of doing business and reducing the cost of tax compliance.

    READ MORE: Electricity withholding tax not applicable on ATL domestic consumers

    “As fixed and final tax regime has been introduced in this fiscal year therefore, no tax or audit notices will be sent to the IT sector professionals and easier documentation will be the priority,” FBR chairman said.

    Special Assistant to the Prime Minister on youth affairs Miss Shaza Fatima and the Prime Minister’s task force on Information technology and Telecom sector, convened a meeting in the Prime Minister’s office to discuss IT sector exports taxation issues and the impact thereof particularly of small and medium IT companies and software houses, with Chairman FBR Asim Ahmad, officials of the Ministry of IT and representatives of PASHA.

    READ MORE: Tax rates on goods, passenger transport vehicles during 2022-2023

    The Prime Minister Mian Shehbaz Shareef constituted a task force to devise ways to increase the Information Technology exports by $3 billion till 2023.

    On the note of exemption from the proposed 0.25 per cent tax, this will remain and it is a quarter of what the other exporters pay.

    In the Final Tax Regime, the Federal Board of Revenue has agreed in principle to resolve sales tax registration and return filing issues.

    READ MORE: FBR notifies tax rates on brokerage, commission during 2022-2023

    The definitions of IT in the June 2022 Finance Act were deliberated upon, and found to be all inclusive. The Federal Board of Revenue has also agreed in principle to propose necessary changes in law for all IT exports to attain the benefit of final tax regime.

    In principle the FBR agreed upon the proposal that if the Provincial consensus is reached, Federal Excise Duty (FED) can be reduced from 19.5 per cent to 17 per cent for Telecom sector.

    The funds received by the IT sector through applications like Payoneer etc. will be given the benefit of final tax regime through necessary changes in the law, if required.

    READ MORE: Non-ATL to pay 200% more tax on motor vehicle purchase during 2022-2023

  • Electricity withholding tax not applicable on ATL domestic consumers

    Electricity withholding tax not applicable on ATL domestic consumers

    Domestic consumers of electricity are not subject to withholding income tax if their names are in the Active Taxpayers List (ATL).

    The Federal Board of Revenue (FBR) has issued updated withholding tax card 2022-2023 after incorporating amendments made through Finance Act, 2022 to the Income Tax Ordinance, 2001.

    READ MORE: Tax rates on goods, passenger transport vehicles during 2022-2023

    The FBR collects withholding tax on the electricity consumption under Section 235 of the Income Tax Ordinance, 2001.

    Following are the withholding tax rates and text of the Section 235:

    WITHHOLDING TAX RATES ON ELECTRICITY

    For commercial and industrial consumers:

    1. There will be no tax on gross amount of bill up to Rs500

    2. The rate of withholding tax shall be Rs10 per cent of the amount where gross amount of bill exceeds Rs500 but does not exceed Rs20,000.

    READ MORE: FBR notifies tax rates on brokerage, commission during 2022-2023

    3. The tax shall be Rs1950 plus 12 per cent of the amount exceeding Rs20,000 for commercial consumers. Rs1,950 plus 5 per cent of amount exceeding Rs20,000 for industrial consumers where gross amount of bill exceeds Rs20,000.

    For domestic consumers: (The tax is applicable on person not appearing on ATL)

    The rate of tax to be collected on domestic electricity consumption shall be: (i) zero percent the amount of monthly bill is less than Rs. 25,000; and (ii) 7.5 per cent if the amount of monthly bill is Rs. 25,000 or more.

    READ MORE: Non-ATL to pay 200% more tax on motor vehicle purchase during 2022-2023

    Section 235. Electricity consumption

    (1) There shall be collected advance tax at the rates specified in Division IV of Part-IV of the First Schedule on the amount of electricity bill of a commercial or industrial or domestic consumer:

    Provided that the provisions of sub-section (1) shall not apply to a domestic consumer of electricity if his name appears on the Active Taxpayers’ List.

    (1A) In addition to tax collectible under sub-section (1), there shall be collected tax at the rates given in the Division IV of Part IV of First Schedule from retailers and service providers as provided under section 99A of the Ordinance:

    Provided that the tax shall not be collectible under this sub-section if the tax has been collected from the person under sub-section (9) of section 3 of the Sales Tax Act, 1990 as provided in the general order issued under section 99A of the Ordinance.

    READ MORE: FBR notifies tax rates on prize bond, lottery winning during 2022-2023

    (2) The person preparing electricity consumption bill shall charge advance tax under sub-section (1) in the manner electricity consumption charges are charged.

    Explanation.— For removal of doubt, it is clarified that for the purposes of this section electricity consumption bill referred to in sub-section (2) means electricity bill inclusive of sales tax and all incidental charges.

    (3) Advance tax under this section shall not be collected from a person who produces a certificate from the Commissioner that his income during tax year is exempt from tax or that he has discharged advance tax liability under section 147 or whose entire income is subject to final tax regime or minimum tax regime under any provisions of this Ordinance other than this section.

    READ MORE: Tax rates for rental income from immovable property during 2022-2023

    (4) Under this section, —

    (a) in the case of a taxpayer other than a company, tax collected upto bill amount of three hundred and sixty thousand Rupees per annum shall be treated as minimum tax on the income of such persons and no refund shall be allowed;

    (b) in the case of a taxpayer other than a company, tax collected on monthly bill over and above thirty thousand rupees per month shall be adjustable; and

    (c) in the case of a company, tax collected shall be adjustable against tax liability.

  • Prime Minister Shehbaz wishes Hindu community on Diwali

    Prime Minister Shehbaz wishes Hindu community on Diwali

    ISLAMABAD: Prime Minister Shehbaz Sharif on Monday whished the Hindu community in the country on their festive occasion of Diwali.

    “Wishing the Hindu community in Pakistan and around the world on Diwali, the festival of lights,” the prime minister said in a tweet.

    The prime minister wished for Diwali to become a source of peace and happiness for all.

    Hindus across the globe and in Pakistan are celebrating the occasion of Diwali that celebrates the triumph of light over dark and good over evil.

    The Constitution of Pakistan gives equal opportunities to minorities to freely practice their religion and celebrate their occasions.