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  • FBR to prescribe valuation method for used vehicles

    FBR to prescribe valuation method for used vehicles

    ISLAMABAD: Federal Board of Revenue (FBR) will prescribe method for valuation of used vehicles for the purpose of sales tax.

    FBR sources said that amendment has been made to Sales Tax Act, 1990 through Finance Act, 2020 related to value of supply of used vehicles.

    According to the amendment, in case of registered person who is engaged in purchasing used vehicles from general public on which sales tax had already been paid at the time of import or manufacturing, and which paid at the time of import or manufacturing, and which are, later on, sold in the open market after making certain value addition, value of supply will be difference between sale and purchase price of the said vehicles on the basis of the valuation method prescribed by the board [FBR].

  • NBMFCs borrowers reschedule loans worth Rs36bn: SECP

    NBMFCs borrowers reschedule loans worth Rs36bn: SECP

    ISLAMABAD: The Non-bank Microfinance Companies (NBMFCs) have reschedule loans of worth Rs36billion of total 2,244,605 individuals and micro-enterprises as of June 30, 2020, Securities and Exchange Commission of Pakistan (SECP) said on Tuesday.

    The SECP said that it had relaxed the regulatory requirements for non-bank finance sector allowing them to defer or reschedule the loan repayments of their borrowers during COVID-19 pandemic.

    Out of these, 1,379,330 borrowers were facilitated through deferment of principal repayments of Rs27.778 billion by twelve NBMFCs, while 865,275 borrowers benefited through rescheduling of loans of 7.998 billion rupees by nine NBMFCs.

    The SECP has already extended the time by three months for NBMFCs to accept deferment requests of borrowers till September 30, 2020.

    Earlier, the SECP had urged the NBMFCs to adopt a considerate approach to accommodate their borrowers who belong to unprivileged segments of the society.

    The SECP had also allowed NBMFCs to accept borrowers requests made through electronic means or phone calls. It is part of SECP’s efforts to provide relief for mitigating adverse effects of COVID-19 pandemic that has resulted in slowdown in business and livelihood activity.

  • Excessive Billing: NEPRA asked to conduct detailed audit of K-Electric

    Excessive Billing: NEPRA asked to conduct detailed audit of K-Electric

    KARACHI: Sindh Governor Imran Ismail on Tuesday asked National Electric Power Regulatory Authority (NEPRA) to conduct detailed audit of K-Electric as many complaints were received related to excessive billing.

    In a letter to Tauseef H Farooqi, Chairman, NEPRA, the Sindh governor said that on a daily basis, a large section of society was complaining against K-Electric (KE) authorities for multiple issues, one out of them is excessive billing. Unfortunately, KE-being the sole electricity provider to Karachi City has an obvious monopolistic approach towards its consumers.

    “It becomes a nightmare for a common person, when he receives an exaggerated bill from KE, as there is a general perception that such situation has no remedy,” according to the letter.

    As a matter of fact, KE instead of giving people relief against their complaints, advise them to pay the billed amount first (to avoid disconnection of electricity) and then wait for what KE decides upon their complaints.

    It is pertinent to add that these complaints are not limited with domestic consumers only, commercial and industrial consumers are also facing similar approach from KE, and voicing against excessive billing at different forum.

    The Sindh governor proposed that the NEPRA to accord instructions for conducting a thorough audit of complaints lodged against KE for excessive billing.

    “And those which are found valid, be refunded their excessive paid amount instantly,” according to the letter.

  • Share market gains 127 points amid hydrocarbon discovery

    Share market gains 127 points amid hydrocarbon discovery

    KARACHI: The share market gained 127 points on Tuesday as energy scrips witnessed improved trading after hydrocarbon discovery announced by POL.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 36,745 points as against 36,619 points showing an increase of 127 points.

    Analysts at Arif Habib Limited said that the market realized a second consecutive day with +460 million volume and in the process posted a gain of 317 points during the session taking the KSE100 index to a recent time high of 36,936 points.

    Highlight of the day turned out to be PPL, which realized high trading volume and after initial trades at below LDCP, the price spiked significantly. Despite international crude prices facing a down day, E&P scrips (PPL and POL) posted decent gains.

    POL also announced a hydrocarbons discovery that took the stock price trading near upper circuits. Profit booking was mainly observed in Cement sector throughout the day, and similar pressure was observed in E&P stocks that brought the Index to close +127 points.

    Cement sector posted highest traded volumes of 51.9 million shares, followed by Power (48.1 million) and Cable (37.9 million). Among scrips, KEL topped the volumes with 39.2 million shares, followed by PAEL (33.5 million) and MLCF (25.2 million).

    Sectors contributing to the performance include E&P (+66 points), Inv Banks (+36 points), Fertilizer (+24 points), Misc (+11 points), Pharma (+10 points), Cement (-23 points) and O&GMCs (-15 points).

    Volumes declined slightly to 466 million shares against 468.9 million shares the other day (-0.6 percent DoD). Average traded value also declined by 2 percent to reach US$ 109.5 million as against US$ 111 million.

    Stocks that contributed significantly to the volumes include KEL, PAEL, MLCF, PPL and UNITY, which formed 30 percent of total volumes.

    Stocks that contributed positively to the index include POL (+44 points), DAWH (+31 points), PPL (+16 points), KEL (+15 points) and SHFA (+11 points). Stocks that contributed negatively include PSO (-18 points), LUCK (-11 points), HUBC (-10 points), BAFL (-9 points), and DGKC (-8 points).

  • Rupee eases by five paisas on import demand

    Rupee eases by five paisas on import demand

    KARACHI: The Pak Rupee eased by five paisas against dollar on Tuesday owing to demand for import and corporate payments.

    The rupee ended Rs166.68 to the dollar from last day’s closing of Rs166.63 in interbank foreign exchange market.

    Currency experts said that dollar demand was remained higher for import and corporate payments. They said that due to ease in lockdown the domestic demand was increased substantially. However significant inflows prevented sharp decline in rupee value.

    They said that improved foreign exchange reserves and lower import demand to help the rupee to gain in coming days.

    The official reserves held by the SBP increased by $811 million to $12.042 billion by week ended July 03, 2020 as compared with $11.231 billion a week ago.

    The SBP attributed the increase in reserves to proceeds of $1,000 million as GOP loan disbursement from China.

    During the week, SBP also made government external debt payments of $ 231.2 million.

    The currency experts said that the lower import bill also helped the rupee to make gain.

    According to Pakistan Bureau of Statistics (PBS) the import bill of the country fell by 18.6 percent to $44.57 billion as compared with $54.76 billion in the preceding fiscal year.

    This helped the country to curtail the trade deficit for the year. The trade deficit of the country shrank by 27 percent to $23.18 billion during fiscal year 2019/2020 as compared with the deficit of $31.8 billion in the preceding fiscal year

  • Procedure for alternate dispute resolution

    Procedure for alternate dispute resolution

    ISLAMABAD: Federal Board of Revenue (FBR) has laid down procedure for alternate dispute resolution (ADR) in order to provide a platform to taxpayers for expeditious resolution of their cases.

    A new section 134A has been introduced to Income Tax Ordinance, 2001 through Finance Act 2020.

    Section 134A. Alternative dispute resolution.

    (1) Notwithstanding any other provision of this Ordinance, or the rules made thereunder, an aggrieved person in connection with any dispute pending before a court of law or an appellate authority pertaining to—

    (a) the liability of tax against the aggrieved person, or admissibility of refunds, as the case may be;

    (b) the extent of waiver of default surcharge and penalty; or

    (c) any other specific relief required to resolve the dispute, may apply to the Board for the appointment of a committee for the resolution of any hardship or dispute mentioned in detail in the application, which is under litigation in any court of law or an appellate authority, except where criminal proceedings have been initiated or where interpretation of question of law having effect on identical cases is involved having effect on other cases.

    (2) The Board may, after examination of the application of an aggrieved person, appoint a committee, within sixty days of receipt of such application in the Board, comprising,—

    (i) Chief Commissioner Inland Revenue having jurisdiction over the case;

    (ii) two persons from a panel notified by the Board comprising of chartered accountants, cost and management accountants, advocates, having minimum of ten years’ experience in the field of taxation and reputable businessmen.

    (3) The Board shall communicate the order of appointment of committee to the court of law or the appellate authority where the dispute is pending and the Commissioner.

    (4) The Committee appointed under sub-section (2) shall examine the issue and may, if it deemed necessary, conduct inquiry, seek expert opinion, direct any officer of the Inland Revenue or any other person to conduct an audit and shall decide the dispute through consensus, within one hundred and twenty days of its appointment.

    (5) The Committee may, in case of hardship, stay recovery of tax payable in respect of dispute pending before it for a period not exceeding one hundred and twenty days in aggregate or till the decision of the committee or its dissolution, whichever is earlier.

    (6) The decision of the committee under sub-section (4) shall be binding on the Commissioner when the aggrieved person, being satisfied with the decision, has withdrawn the appeal pending before the court of law or any appellate authority and has communicated the order of withdrawal to the Commissioner:

    Provided that if the order of withdrawal is not communicated to the Commissioner within sixty days of the service of decision of the committee upon the aggrieved person, the decision of the committee shall not be binding on the Commissioner.

    (7) If the Committee fails to decide within the period of one hundred and twenty days under sub-section (4), the Board shall dissolve the committee by an order in writing and the matter shall be decided by the court of law or the appellate authority where the dispute is pending.

    (8) The Board shall communicate the order of dissolution to the court of law or the appellate authority and the Commissioner.

    (9) The aggrieved person, on receipt of the order of dissolution, shall communicate it to the court of law or the appellate authority, where the dispute is pending.

    (10) The aggrieved person may make the payment of income tax and other taxes as decided by the committee under sub-section (4) and all decisions and orders made or passed shall stand modified to that extent.

    (11) The Board may prescribe the amount to be paid as remuneration for the services of the members of the committee, other than the member appointed under clause (i) of sub-section (2).

    (12) The Board may, by notification in the official Gazette, make rules for carrying out the purposes of this section.

  • SBP allows banks to verify customers through NADRA Verisys for record keeping

    SBP allows banks to verify customers through NADRA Verisys for record keeping

    KARACHI: State Bank of Pakistan (SBP) has allowed banks to retain digital record of identity i.e. NADRA Verisys of customers for record keeping requirements.

    In a statement issued on Monday, the central bank said that the banks and Development Financial Institutions (DFIs) may use the NADRA [National Database Registration Authority] Verisys in place of obtaining certified photo copies of required NADRA identity documents and bio metric verifications wherever required as per SBP AML/CFT Regulations including for request of activation of dormant account by customers.

    “They should retain the NADRA Verisys for record keeping requirements (digitally or hard copy).”

    The directives have been issued under measures taken to mitigate COVID-19 pandemic.

    Keeping in view the ongoing impact of COVID-19 pandemic in the country, it has been decided to extend the validity of the measures from June 30, 2020 to December 31, 2020.

    In addition, it has been observed that customers including (overseas Pakistani /walk in/ occasional) are experiencing problems with regard to operation in their bank accounts, ensuring execution of financial transactions by them and getting financial services from banks/DFI.

    The following revisions are being made in the existing AML/CFT requirements to facilitate such customers:

    Banks/DFIs may use the NADRA Verisys in place of obtaining certified photo copies of required NADRA identity documents and bio metric verifications wherever required as per SBP AML/CFT Regulations including for request of activation of dormant account by customers. They should retain the NADRA Verisys for record keeping requirements (digitally or hard copy).

    Banks/DFIs to update records of their customers with regard to their postal address or email address or register mobile number or land line number. They may use either of these medium for ensuring efficient and reliable communications with their customers including where ever customer request/instruction is desired as per requirement of AML/CFT regulation including for activation of dormant accounts.

    Further, the requirement of originator’s and beneficiary’s address in wire transfer vide Regulation-3, para (3c & 3e) of AML / CFT Regulations for Banks/ DFIs has been amended as below.

     Reference Existing Requirement Revised Requirement

    R-3 Para(3c & 3e)
    Bank/DFI shall include the following information in the message or payment instruction which should accompany or remain with the wire transfer throughout the payment chain:

    ( c )  the originator’s address and CNIC/ passport number (e) the beneficiary’s address and CNIC/ passport number
    Bank/DFI shall include the following information in the message or payment instruction which should accompany or remain with the wire transfer throughout the payment chain:

    ( c )  the originator’s CNIC/ passport number (e) the beneficiary’s CNIC/ passport number

    These instructions are enforceable with effect from July 01, 2020.

  • Annual car sales plunge by 53 percent on slow economy, COVID

    Annual car sales plunge by 53 percent on slow economy, COVID

    KARACHI: Domestic car sales have plunged by 53 percent in fiscal year 2019/2020 owing to slow economic activity and outbreak of coronavirus, analysts said on Monday.

    According to statistics released by Pakistan Automobile Assemblers Association (PAMA), the total car sales plunged to 110,583 units during fiscal year 2019/2020 as compared with 235,229 units in the preceding fiscal year.

    Analysts at Topline Securities said that the year remained turbulent for the car assemblers, as slow economic activity and high interest rates affected demand at the start of the year. In the last quarter, sales were severely affected by COVID-19 outbreak.

    The domestic car sales also witnessed 52 percent decline to 8,446 units in June 2020 as compared with 17,468 units in the same month of the last year.

    However, the sales increased by 77 percent when compared with the sales of May 2020 as car dealerships became operational after lifting of COVID-19 related lockdowns/restrictions.

    Honda Car (HCAR) and Indus Motors (INDU) recorded 514 percent MoM and 199 percent MoM growths, respectively.

    The major decline came in sales of Honda Cars which fell by 63 percent to 16,390 units in fiscal year 2019/2020 when compared with 44,234 units in the preceding fiscal year.

    Indus Motors witnessed 53 percent decline to 28,378 units in fiscal year 2019/2020 as compared with 60,993 units in the preceding fiscal year.

    The sales of Pak Suzuki Motors registered 49 percent decline to 65,815 units during fiscal year 2019/2020 as compared with 130,002 units in the preceding fiscal year.

  • Equity market gains 428 points on increased activity in construction

    Equity market gains 428 points on increased activity in construction

    KARACHI: The equity market gained 428 points on Monday owing to increased activity in construction sector, analysts said.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 36,619 points as against 36,190 points showing an increase of +428 points.

    Analysts at Arif Habib Limited said that the first day after resumption of trading hours to Pre-COVID brought higher volumes, touching 468 million shares which is slightly higher than what was observed on Thursday.

    This is the highest volume so far in CY20. Index also moved uni-directional, gaining 532 points during the session and closing at +428 points.

    Cement sector led the sentiment with MLCF realizing the most trading volumes in recent times.

    Majority of the cement sector scrips traded at and near upper circuits. Recently announced Housing Scheme has brighten the prospects for the Cement companies in addition to declining coal prices and increase in retail price / bag.

    Among O&GMCs, PSO and SSGC stood out with higher volumes and price appreciation. Similar bullish sentiment was observed in Steel sector, which saw ASTL and MUGHAL hitting upper circuits.

    Overall, Cement sector topped the volumes with 144.5 million shares (30 percent of total traded volumes), followed by Technology (43.2 million) and Engineering (34.2 million).

    Among scrips, PAEL (21.9 million) and TRG (21.2 million) followed MLCF with 76.4 million shares.

    Sectors contributing to the performance incude Cement (+162pt), O&GMCs (+56 points), E&P (+50 points), Banks (+37 points) and Autos (+31 points).

    Volumes increased from 292.7 million shares to 468.9 million shares (+60 percent DoD). Average traded value also increased by 94 percent to reach US$ 111.4 million as against US$ 57.5 million.

    Stocks that contributed significantly to the volumes include MLCF, PAEL, TRG, HASCOL and POWER, which formed 33 percent of total volumes.

    Stocks that contributed positively to the index include LUCK (+57 points), PSO (+42 points), DGKC (+34 points), MEBL (+21 points) and CHCC (+19 points). Stocks that contributed negatively include PSEL (-7 points), EFUG (-6 points), PAKT (-5 points), HUBC (-5 points), and BOP (-5 points).

  • FBR extends warehousing period up to July 31

    FBR extends warehousing period up to July 31

    ISLAMABAD: The Federal Board of Revenue (FBR) has taken a significant step by extending the warehousing period for already in-bonded goods up to July 31, 2020.

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