The Federal Board of Revenue (FBR) has taken stringent measures to recover outstanding dues by attaching the bank accounts of the Sui Southern Gas Company Limited (SSGC) amounting to Rs23 billion.
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PM Imran announces setting up technology startup fund
ISLAMABAD: Prime Minister Imran Khan on Tuesday announced to set up Pakistan Technology Startup Fund to provide seed funding worth Rs1 billion to around 50 startups annually.
He made this announcement while chairing a meeting in Islamabad to follow up on his foreign visits and IT sector initiatives introduced by the government.
READ MORE: PM Imran visits Russia on February 23-24
Imran Khan said we are announcing tax holiday and 100 per cent foreign exchange retention for IT Companies and freelancers registered with Pakistan Software Export Bureau to incentivise investment in the IT sector for economic turnaround.
Emphasizing on his vision to boost IT exports to $50 billion in the next few years, the Prime Minister highlighted the importance of unleashing the IT industry by providing them ease of doing business and the best incentives globally available.
READ MORE: Tax reduced on POL products to ease inflation: PM Imran
He directed the authorities concerned to establish Special Technology Zones on fast track basis in Islamabad and all provincial capitals to create hubs of IT and Technology innovation and investment in cities. In the first phase, sectors of CDA in Islamabad will be declared as Special Technology Zones so that IT firms and freelancers can avail the benefits offered by Special Technology Zones Authority.
READ MORE: Pakistan’s sensitive price inflation jumps up 18%
The Prime Minister also directed them to introduce necessary changes in the Foreign Exchange and Income Tax policies in order to help IT Startups thrive in the country. These reforms include launch of Roshan Digital IT Accounts by State Bank of Pakistan to allow freelancers and IT firms to retain 100 percent of their foreign income in foreign exchange with no restrictions on the movement of forex, resolution of double taxation of IT Sector by FBR, and the exemption from Capital Gains Tax of venture funding (VC) into startups. The Prime Minister directed to attract local and international VC funding into IT Startups for creating jobs and bringing forex.
READ MORE: PM Imran launches 2nd phase of Raast payment system
Imran Khan said that Tech-savvy youth and Information Technology sector are Pakistan’s biggest assets that can be exploited to bridge the huge current account deficit.
Earlier the Prime Minister was informed that ICT export remittances in last fiscal year remained 2.1 billion dollars as compared to one billion dollars in 2018 and Pakistan is exporting to 120 plus countries in the world.
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PM Imran visits Russia on February 23-24
ISLAMABAD: Prime Minister Imran Khan will pay an official visit to Russia on February 23-24, 2022.
The Pakistan premier is paying the official visit on the invitation of President of the Russian Federation Vladimir Putin.
The Prime Minister will be accompanied by a high-level delegation including members of the Cabinet.
The bilateral summit will be the highlight of the visit. Pakistan and Russia enjoy friendly relations marked by mutual respect, trust and convergence of views on a range of international and regional issues.
During the Summit meeting, the two leaders will review the entire array of bilateral relations including energy cooperation.
They will also have wide-ranging exchange of views on major regional and international issues, including Islamophobia and situation in Afghanistan.
The visit of the Prime Minister will contribute to further deepening of the multifaceted Pakistan-Russia bilateral relationship and enhancement of mutual cooperation in diverse fields.
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FBR exempts regulatory duty on Afghan pine nuts
ISLAMABAD: The Federal Board of Revenue (FBR) has exempted regulatory duty at the rate of 45 per cent on import of pine nuts (chilgoza) from Afghanistan.
The FBR issued SRO 181(I)/2022 dated February 22, 2022 to allow the exemption.
Through the latest SRO, the FBR amended the SRO 840(1)/2021 dated June 30, 2021.
The FBR through the latest SRO noted: “[pine nuts (chilgoza) imported from Afghanistan are exempted from regulatory duty at the rate of 45 per cent.”
Prior to this the Pakistan government expanded the list of goods for export to Afghanistan and through Afghanistan to Central Asian Republics without requirement of E-form and against Pakistan Rupee (PKR).
In this regard the ministry of commerce issued SRO176(I)/2022 dated February 04, 2022 to amend Export Policy Order 2020.
READ MORE: List of goods export to Afghanistan in PKR, no E-form
As per the export policy order, export goods to Afghanistan and through Afghanistan to Central Asian Republics are allowed against Pakistan currency on filing of regular shipping bills without the requirement of E-form.
Prior to the amendment, the allowed goods are included: fruits; vegetables; dairy products; and meat. However, after the amendment more number of goods have been added to the list, which included: rice; fish and fish products; poultry, meat and products; sugar confectionary and bakery products; fruits, nuts and other edible parts of plants; oilcake and other solid residues; vegetable materials and vegetable waste; salt; cement; pharmaceuticals; matches; textile and textile articles; building stone; and surgical instruments.
As per the Export Policy Order, 2021, the goods are not entitled to: zero rating of sales tax on taxable goods; rebate of central excise duty; and payment of drawback of customs duty.
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Sales tax collection from POL products falls by 40%
ISLAMABAD: The Federal Board of Revenue (FBR) has recorded a decline of 40 per cent in sales tax (ST) collection on petroleum (POL) products during the first half of the current fiscal year, according to official documents made available to PkRevenue.com
According to the official statistics, the collection of sales tax fell to Rs69 billion during July – December of fiscal year 2021/2022 as compared with Rs114.60 billion collected in the same period of the last fiscal year.
READ MORE: Share of sales tax collection increases to 43.7% in 1HFY22
The decline in revenue collection from petroleum products mainly attributed to lower rates of sales tax kept by the government in order to provide relief to the masses by not passing on the actual increase in petroleum prices as surge in international markets.
The flat rate of sales tax is 17 per cent. However, the government decided to keep the rate of sales tax on petroleum products to the minimum level. According to SRO 1839i0/2022 issued on February 10, 2022, the sales tax rates have been reduced as: petrol 0.79 per cent; high speed diesel 3.17 per cent, kerosene oil 5.30 per cent and light diesel oil at zero per cent.
READ MORE: FBR extends sales tax return filing up to February 25
The fall in sales tax collection from supply of petroleum products resulted decline in collection of sales tax on domestic supply.
The overall sales tax collection on domestic supplies fell by 6.2 per cent to Rs382.68 billion during the first half of the current fiscal year as compared with Rs408.13 billion in the corresponding period of the last fiscal year.
However, the fall in sales tax collection domestic was offset by the massive growth in collection of sales tax on imports. The sales tax collection on imports surged by 75.4 per cent to Rs892.30 billion during the first half of the current fiscal year as compared with Rs508.61 billion in the corresponding half of the last fiscal year.
READ MORE: FBR announces promotion of BS-16 Customs officers
The growth in sales tax collection on imports can be attributed to sharp jump in imports and massive decline in rupee value.
The import bill of the country registered a growth of 66.23 per cent to $40.65 billion during first half of the current fiscal year as compared with $24.45 billion in the corresponding half of the last fiscal year.
READ MORE: FBR makes rules for sealing retail outlets
Similarly, the Pak Rupee (PKR) fell sharply by Rs18.97 to the dollar during the first half of the current fiscal year. The rupee ended down by 12.04 per cent from Rs157.54 to the dollar on June 30, 2021 to Rs176.51 on December 31, 2021.
The overall sales tax collection however, recorded 39.1 per cent to Rs1.27 trillion during the first half of the current fiscal year as compared with Rs916 billion in the corresponding half of the last fiscal year.
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Share of sales tax collection increases to 43.7% in 1HFY22
ISLAMABAD: The share of sales tax has increased to 43.7 per cent in total federal tax collection during first half (July – December) of current fiscal year (1HFY22) as compared with 41.6 per cent in the same half of the last fiscal year.
According to biannual report issued by the Federal Board of Revenue (FBR) for the period July – December 2021/2022, showed that the share of direct taxes, which includes income tax, fell to 35 per cent during the half year under review as compared with 37.5 per cent in the same half of the last fiscal year.
READ MORE: FBR extends sales tax return filing up to February 25
The share of customs duty collection improved to 16.3 per cent during the first half of the current fiscal year as compared with 15.2 per cent in same half of the last fiscal year.
Meanwhile, the contribution of federal excised duty collection declined to 5 per cent during July – December 2021/2022 as compared with 5.8 per cent in the same period of the last fiscal year.
The total tax collection of the FBR during first half of the current fiscal year recorded 32.5 per cent growth to Rs2.92 trillion as compared with Rs2.2 trillion in the same half of the last fiscal year.
READ MORE: FBR announces promotion of BS-16 Customs officers
The collection of sales tax recorded an increase of 39.1 per cent to Rs1.275 trillion during the half year under review as compared with Rs917 billion in the corresponding half of the last year.
The direct tax collection posted 23.6 per cent growth to Rs1.02 trillion during the first half of the current fiscal year as compared with Rs826 billion in the same half of the last fiscal year.
The collection of customs duty posted 43 per cent growth to Rs477 billion during the half year under review as compared with Rs334 billion in the same half of the last fiscal year.
READ MORE: FBR makes rules for sealing retail outlets
Likewise, the federal excise duty collection posted 15.3 per cent growth to Rs146.3 billion during July – December 2021/2022 as compared with Rs127 billion in the corresponding period of the last fiscal year.
The FBR issued refunds and rebates to the tune of Rs148.53 billion during the first half of the current fiscal year as compared with Rs111.3 billion in the same half of the last fiscal year.
The issuance of sales tax refunds grew by 26 per cent to Rs123.5 billion during the period under review as compared with Rs98 billion in the same period of the last fiscal year.
READ MORE: LTO Karachi facilitates Tier-1 retailers in POS integration
However, the issuance of income tax refunds fell drastically by 29 per cent to Rs5.14 billion during the first half of the current fiscal year as compared with Rs7.28 billion in the same half of the last fiscal year.
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Tax reduced on POL products to ease inflation: PM Imran
Prime Minister Imran Khan on Friday said the government has reduced taxes and duties on petroleum products to ease inflationary pressure.
The Prime Minister Imran Khan said Pakistan has been put on right course with record exports, tax collection and remittances by the expatriates.
READ MORE: Pakistan’s sensitive price inflation jumps up 18%
Addressing a public gathering in Mandi Bahauddin, he said the inflation impacting the common man and the government is trying to ebb away its pressure by reducing taxes and duties on petrol import.
Imran Khan said for the first time, the government also granted overseas Pakistanis voting right, enhanced farmers’ income, ensured the timely payments to sugarcane farmers.
READ MORE: Pakistan’s inflation climbs up 24-month high in January
The prime minister said the government is bringing about an IT revolution in the country as 70% rise in IT exports has been recorded. He also said the government was providing interest free loans to the youth and Rs 1 million health insurance to every family in Punjab.
READ MORE: January headline inflation may clock near 13%
Imran Khan said this is just the beginning and we have to make Pakistan a welfare state with Sehat Card being the biggest step towards it.
He said by March, Sehat Card will be available across Punjab for which provincial government has allocated 400 billion rupees.
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Pakistan’s sensitive price inflation jumps up 18%
ISLAMABAD: The inflation based on Sensitive Price Indicator (SPI) jumped up by 18 per cent by week ended February 17, 2022 as compared with the same week a year ago.
According to data released by Pakistan Bureau of Statistics (PBS) on Friday, the year on year trend depicts an increase of 18.09 per cent, in Tomatoes (322.87 per cent), Electricity for Q1 (65.79 per cent), Garlic (60.98 per cent), LPG (55.11 per cent), Mustard Oil (48.44 per cent), Petrol (42.28 per cent), Cooking Oil 5 litre (41.81 per cent), Vegetable Ghee 1 Kg (39.13 per cent), Vegetable Ghee 2.5 Kg (38.97 per cent), Washing Soap (38.40 per cent), Pulse Masoor (37.19 per cent) and Diesel (32.26 per cent).
READ MORE: Pakistan’s inflation climbs up 24-month high in January
While major decrease observed in the prices of Chillies Powdered (36.30 per cent), Pulse Moong (28.43 per cent), Chicken (9.77 per cent), Sugar (5.72 per cent), Onions (3.84 per cent) and Potatoes (0.38 per cent).
The SPI is computed on weekly basis to assess the price movements of essential commodities at shorter interval of time so as to review the price situation in the country. SPI comprises of 51 essential items collected from 50 markets in 17 cities of the country.
READ MORE: January headline inflation may clock near 13%
The SPI for the current week ended on February 17, 2022 recorded an increase of 0.22 per cent. Increase in the prices of food items Garlic (10.53 per cent), Tomatoes (4.35 per cent), Bananas (4.28 per cent), Chicken (2.89 per cent), Cooked Daal (1.94 per cent) and Vegetable Ghee 2.5kg (1.08 per cent) and non-food items Petrol (8.12 per cent), Diesel (6.52 per cent), Match Box (2.17 per cent) and Long Cloth (1.50 per cent) was observed with joint impact of (1.21 per cent) into the overall SPI for combined group of (0.22 per cent).
READ MORE: Mini-budget likely to push up inflation: SBP
On the other hand, decrease is observed in the prices of Chillies Powdered (5.41 per cent), Eggs (5.31 per cent), Electricity for Q1 (5.20 per cent), Onions (1.39 per cent), Potatoes (0.89 per cent), Gur (0.82 per cent), Sugar (0.59 per cent), Wheat Flour (0.27 per cent), LPG (0.17 per cent), Pulse Moong (0.11 per cent), and Pulse Mash (0.08 per cent).
During the week, out of 51 items, prices of 28 (54.90 per cent) items increased, 11 (21.57 per cent) items decreased and 12 (23.53 per cent) items remained stable.
READ MORE: Headline inflation rises by 12.3% in December 2021
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Pakistan spends Rs217 billion to import mobile phones
ISLAMABAD: Pakistan has spent Rs217 billion to import mobile phones during first seven months (July – December) 2021/2022, according to data release by Pakistan Bureau of Statistics (PBS).
The import of mobile phones grew by 17.25 per cent when compared with Rs185 billion in the first seven months of the fiscal year 2020/2021.
READ MORE: FBR issues updated rates of duty, taxes on mobile phones
The growth in the import of mobile phones may be attributed to depreciation in rupee value against the dollar.
The rupee weakened by Rs17.85 or 11.33 per cent to the dollar when compared Rs157.54 on June 30, 2021 with Rs175.39 as on February 17, 2022.
READ MORE: Regulations needed for used mobile phones’ accessories
The local currency recorded all-time low of Rs178.24 to the dollar on December 29, 2021.
In dollar term, the import of cellphones recorded a growth of 12 per cent to $1.27 billion during first seven months of the current fiscal year as compared with $1.13 billion in the corresponding months of the last fiscal year.
READ MORE: FBR collects mobile phone tax, PTA clarifies
However, the import of mobile phones recorded a decline of 8.68 per cent to $179.77 million in the month of January 2022 when compared with $197 million in the same month of the last year.
The decline may be attributed to production of mobile phones locally.
READ MORE: FBR increases income tax to 15% on cellular services
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Foreign investment surges by 176% during July – January
KARACHI: The overall inflow of foreign investment in the country recorded 176 per cent during first seven months (July – January) 2021/2022 due to the inflows of debt securities to the tune of $1.057 billion received in January 2022, according to data released by the State Bank of Pakistan (SBP) on Thursday.
The total foreign investment increased to $1.817 billion during the first seven months of the current fiscal year as compared with $659 million in the corresponding months of the last fiscal year.
READ MORE: Pakistan’s foreign investment surges by 73% in 5 months
The net foreign private investment is showing increase of 5.7 per cent to $859 million during July – January 2021/2022 as compared with $812.4 million.
The net inflow of foreign direct investment (FDI), a major component of foreign private investment, into Pakistan has recorded 11.3 per cent during first seven months (July – January) of 2021/2022.
READ MORE: Carrefour enhances Pakistan investment to Rs10.5 billion
The net inflow of the foreign direct investment increased to $1.17 billion during first seven months of the current fiscal year as compared with $1.05 billion in the corresponding period of the last fiscal year.
The increase in net inflow of FDI can be attributed to significant contraction in outflow during the period. The outflow fell by 40 per cent to $468.7 million during the period under review as compared with the outflow of $786 million in the same period of the last fiscal year.
READ MORE: Jazz’s investment in Pakistan crosses $10 billion
However, the portfolio investment, the other component of foreign private investment, recorded a 31 per cent decline during first seven months of the current fiscal year. The outflow under foreign portfolio investment recorded at $308 million during July – January 2021/2022 as compared with outflow of $236 million in the corresponding period of the last fiscal year.
READ MORE: Focus on increasing investment in export industry: PM