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Tag: FBR

FBR, Pakistan’s national tax collecting agency, plays a crucial role in the country’s economy. Pakistan Revenue is committed to providing readers with the latest updates and developments regarding FBR activities.

  • FBR strictly implementing tax laws for revenue collection

    FBR strictly implementing tax laws for revenue collection

    KARACHI: Federal Board of Revenue (FBR) is strictly implementing tax laws for achieving revenue collection target.

    “The tax laws are being strictly implemented and any negligence by the officials of the revenue department will not be tolerated,” Tariq Mehmood Pasha, Special Assistant to the Prime Minister for Revenue said in a meeting with a delegation of business community.

    READ MORE: Last date for filing income tax return is Dec 31

    Pasha further said that the FBR revenue collection is satisfactory. “All goals will be achieved,” Tariq Mehmood Pasha informed the delegation of United Business Group (UBG).

    He said that Prime Minister Mian Shahbaz Sharif is aware of the problems of the business community, all resources are being used to improve the country’s economic condition and the government will soon provide all the economic resources to overcome the problems.

    READ MORE: FTO intervention helps taxpayer to get withholding certificate

    According to Gulzar Feroze, the main spokesperson of UBG, the delegation included President UBG and former President FPCCI Zubair Tufail. Former President FPCCI Abdul Rauf Alam, Former Vice President Atif Ikram Sheikh and Secretary General US Pakistan International Chamber Malik Sohail Hussain were present.

    READ MORE: FBR imposes $5,000 cash carrying limit for foreign travel

    On this occasion, Zubair Tufail said that at present the business conditions in the country are not satisfactory, firstly Covid-19 and later floods have badly affected the industrial and agricultural sector and many sectors have not yet recovered, so the government should provide relief to the business community.

    The UBG delegation congratulated the Special Assistant to the Prime Minister for Revenue, Minister of State Tariq Mehmood Pasha and the FBR administration on the improved revenue situation.

    READ MORE: FBR exempts CVT on assets of Reko Diq Mining Company

  • Last date for filing income tax return is Dec 31

    Last date for filing income tax return is Dec 31

    Last date for filing annual income tax returns for corporate entities is December 30, 2022. By this deadline the companies have financial year ending June 30 are required to file their annual returns.

    However, companies having other financial year, individuals and association of persons (AOPs) are required to file their returns by December 15, 2022, which is already extended three times.

    READ MORE: FTO intervention helps taxpayer to get withholding certificate

    Every year September 30 is the last date for filing income tax returns for business individuals, salaried persons, AOPs and companies having special year. However, for tax year 2022 the Federal Board of Revenue (FBR) has already extended date for return filing first up to October 2022, then November 30, 2022 and latest up to December 15, 2022.

    Section 18 of Income Tax Ordinance, 2001 updated up to June 30, 2022 explained the method of furnishing returns and other documents.

    Following is the text of the Section:

    READ MORE: FBR imposes $5,000 cash carrying limit for foreign travel

    Section 118. Method of furnishing returns and other documents. — (1) A return of income under section 114, a wealth statement under section 116 or a foreign income and assets statement under 116A, if applicable shall be furnished in the prescribed manner.

    (2) A return of income under section 114 of a company shall be furnished —

    (a) in the case of a company with a tax year ending any time between the first day of January and the thirtieth day of June, on or before the thirty-first day of December next following the end of the tax year to which the return relates; or

    (b) in any other case, on or before the thirtieth day of September next following the end of the tax year to which the return relates.

    (2A) Where salary income for the tax year is five hundred thousand rupees or more, the taxpayer shall file return of income electronically in the prescribed form and it shall be accompanied by the proof of deduction or payment of tax and wealth statement as required under section 116 or a foreign income and assets statement under 116A, if applicable”:

    READ MORE: FBR exempts CVT on assets of Reko Diq Mining Company

    “Provided that the Board may amend the condition specified in this sub-section or direct that the said condition shall not apply for a tax year.”

    (3) A return of income for any person (other than a company) shall be furnished as per the following schedule, namely:—

    (a) in the case of a return required to be filed through e-portal in the case of a salaried individual, on or before the 30th day of September] next following the end of the tax year to which the statement or return relates; or

    (b) in the case of a return of income for any person (other than a company), as described under clause (a), on or before the 30th day of September next following the end of the tax year to which the return relates.

    READ MORE: FBR chairman directs chief commissioners to meet December collection target

    (4) A wealth statement shall be furnished by the due date specified in the notice requiring the person to furnish such statement or, where the person is required to furnish the wealth statement for a tax year under sub-section (2) of section 116, by the due date for furnishing the return of income for that year.

    (5) A return required to be furnished by a notice issued under section 117 shall be furnished by the due date specified in the notice.

    (6) Where a taxpayer is not borne on the National Tax Number Register and fails to file an application in the prescribed form and manner with the taxpayer’s return of income, such return shall not be treated as a return furnished under this section.

  • FBR imposes $5,000 cash carrying limit for foreign travel

    FBR imposes $5,000 cash carrying limit for foreign travel

    ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday imposed cash carrying limit of $5,000 for travelling abroad.

    The FBR issued SRO 2201(I)/ 2022 dated December 12, 2022 to make part of law the amendment made to Baggage Rules, 2006. Previously, draft amendments to the rules were introduced through SRO 2043(I)/2022 on November 15, 2022.

    READ MORE: FBR exempts CVT on assets of Reko Diq Mining Company

    According to the latest notification, any person travelling abroad (except to Afghanistan) is allowed to take out Pakistan US Dollars or equivalent thereof in other foreign currencies as per the limits give below:

    For individuals 18 years and above, the maximum limit per person per visit in US$ (or equivalent in other foreign currencies) is $5,000 and annual limit per person in US$ (or equivalent in other foreign currencies) is $30,000.

    For individuals below 18 years, the maximum limit per person per visit in US$ (or equivalent in other foreign currencies) is $2,500 and annual limit per person in US$ (or equivalent in other foreign currencies) is $15,000.

    READ MORE: FBR chairman directs chief commissioners to meet December collection target

    In case of passengers travelling to Afghanistan, the maximum limit per person per visit (US$ or equivalent in other foreign currencies) is $1,000 and annual limit per person (US$ or equivalent in other foreign currencies) is $6,000.

    The FBR said that the annual limits for outbound passengers for the respective countries mentioned above for a calendar year starting from the year 2023. However, for calendar year 2022, the existing annual limits in vogue before the issuance of this notification will continue to be effective till December 31, 2022.

    READ MORE: SRB says cases worth Rs 80 billion stuck in litigation

    The FBR further stated that any person taking foreign currency or any other prohibited or restricted item out of Pakistan shall file a declaration before or at the time of departure, electronically in the WeBOC or pass track or manual at the airport.

    According to the amendments to Baggage Rules, 2006, the incoming passenger when in possession of foreign currency exceeding $10,000 or equivalent, or any other prohibited restricted items, shall also file a declaration.

    READ MORE: Customs appraising officer awarded major penalty for inefficiency

  • FBR exempts CVT on assets of Reko Diq Mining Company

    FBR exempts CVT on assets of Reko Diq Mining Company

    KARACHI: Federal Board of Revenue (FBR) on Monday exempted capital value tax (CVT) on all assets of Reko Diq Mining Company.

    The FBR issued SRO 2200(I)/2022 to announce that the federal government had exempted all assets of the Reko Diq Mining Company (Private) Limited (formerly) Tethyan Copper Company Pakistan (Private) Limited from the whole of the capital value tax payable under sub-section of section 8 to the Finance Act, 2022.

    READ MORE: FBR chairman directs chief commissioners to meet December collection target

    It is worth mentioning that the Economic Coordination Committee of the Cabinet (ECC) a day earlier took important decisions regarding Reko Diq.

    The ECC considered and approved two important agenda items related to Reko Diq project, thus paving the way for early start of the Reko Diq Project. Ministry of Energy (Petroleum Division) submitted a summary on accrued interest with respect to the amount held in an escrow account in connection with the Reko Diq Project dispute settlement.

    READ MORE: SRB says cases worth Rs 80 billion stuck in litigation

    It was presented that government of Pakistan (GoP) and Provincial Government of Baluchistan (GoB) entered into an out-of-court dispute settlement with M/s Tethyan Copper Company Pvt Limited- a consortium of Barrick Gold Corporation of Canada and M/s Antofagasta PLC of Chile, in respect of Reko Diq Copper-Gold Project in Chaghai district of Baluchistan.

    As per settlement terms, Government of Pakistan has to clear liabilities to Antofagasta PLC. In the light of the terms of agreed settlement, the ECC allowed Finance Division to direct GHPL (for its own as well as GoB’s share), OGDCL and PPL to deposit the aggregate amount of interest to the sum of US$ 22,718,173/- in the escrow account from March 31, 2022 to December 15, 2022.

    READ MORE: Customs appraising officer awarded major penalty for inefficiency

    The ECC further allowed Finance Division to arrange the interest payable for GoB’s share amounting to US$ 8,519,314 /- from the loan of Rs. 65 billion already raised by the GHPL with the GoP guarantee.

    Further, the ECC allowed the concerned Divisions of GoP and the SOEs to act in such a manner to ensure that the deposited amount alongwith interest deposited by the SOEs in the escrow account to form part of the consideration for share purchase of Reko Diq Mining Company Limited.

    READ MORE: Further tax collection on pharmaceutical products unlawful: KTBA

    The ECC also considered and approved a proposal of Finance Division through a summary on funding plan of Government of Pakistan for share of Government of Baluchistan in Reko Diq Project.

    As per proposal, overall funding commitment of US$ 717 million over the period of 6 years by GoP in respect of GoB SPV Project Capital Commitment to be provided by the Government of Pakistan.

  • FBR chairman directs chief commissioners to meet December collection target

    FBR chairman directs chief commissioners to meet December collection target

    KARACHI: Asim Ahmed, Chairman, Federal Board of Revenue (FBR) on Saturday directed chief commissioners to ensure meeting revenue collection target for the month of December 2022.

    The FBR chairman visited Large Taxpayers Office (LTO) Karachi and held meeting with Chief Commissioners of all the field formations stationed at Karachi.

    READ MORE: SRB says cases worth Rs 80 billion stuck in litigation

    Asim Ahmed reviewed the performance of all Chief Commissioners vis-à-vis targets assigned for the month of December, 2022.

    Detailed presentations, outlining the projection and strategy for achieving the budgetary target for the current month were given by all Chief Commissioners Inland Revenue.

    The CCIRs gave workable strategy and new avenues for achieving the target set for the month of December, 2022 and closure of 2nd Quarter for the Financial Year 2022-2023.

    READ MORE: Customs appraising officer awarded major penalty for inefficiency

    FBR chairman directed all CCIRs to leave no stone unturned to safeguard Revenue and to meet the budgetary target fixed for the month of December, 2022 and 2nd quarter ending December 31, 2022.

    Chairman FBR further reiterated that facilitation of taxpayers is the harbinger for successful implementation of policies of FBR and taxpayers must be facilitated in resolving their pending issues with the Department, invariably. 

    READ MORE: Further tax collection on pharmaceutical products unlawful: KTBA

    He also directed the CCIRs that the revenue stuck in appeals should be effectively pursued and cases pending test of appeal should be argued, based on strong legal footings, to win the test of appeal thereby safeguarding the revenue and its realization thereafter.

    Asim Ahmed appreciated the field formations on achieving the budget target assigned in the preceding month i.e. November, 2022 and at the same time expected the same zeal and commitment to achieve the targets assigned to them for the Financial Year 2022-2023.

    READ MORE: Non-filers will not be included in ATL 2022

  • Further tax collection on pharmaceutical products unlawful: KTBA

    Further tax collection on pharmaceutical products unlawful: KTBA

    Karachi Tax Bar Association (KTBA) on Thursday termed the collection of further tax on sales of pharmaceutical products to unregistered persons as unlawful.

    In a letter sent to Asim Ahmad, Chairman of Federal Board of Revenue (FBR), the tax bar informed that substances registered as drugs under the Drugs Act, 1976 were earlier exempt from levy of sales tax under the Sales Tax Act, 1990, the Finance (Supplementary) Act, 2022, withdrawn, and the pharmaceutical products were made zero rated in terms of Serial No.19 to the Fifth Schedule of the Act.

    READ MORE: Non-filers will not be included in ATL 2022

    Later one, through the Finance Act 2022, Serial No.19 of the Fifth Schedule was omitted and a new Serial No.81 was introduced in Table-1 of the Eighth Schedule to the Act is as follow:

    Serial No.DescriptionHeading Nos. of the First Schedule to the Customs Act, 1969 (IV of 1969)Rate of Sales TaxCondition
    (1)(2)(3)(4)(5)
    81.Manufacture or import of substances registered as drugs under the Drugs Act, 1976 (XXXI of 1976)Respective Heading1%Subject to the conditions that:   (i) Tax charged and deposited by the manufacturer or importer, as the case may be, shall be final discharge of tax in the supply chain.   (ii) No input tax shall be adjusted by the manufacturer or importer.

    The tax bar stated that it becomes clear that Serial No.81 created the sales tax charge at the rate of 1 per cent on manufacturer/importer of drugs and that the tax so charged and deposited by a manufacturer would be treated as final discharge of sales tax liability for the entire supply chain.

    READ MORE: FBR directs BS-21 officers to submit declaration of assets

    Therefore, once the manufacturer/importer has charged and deposited the sales tax at 1 per cent, the rest of the entire supply chain would be ousted from levy of sales tax.

    KTBA invited the attention of the FBR chairman towards a clarification C.No. 3(16)ST&FE-Policy/2022/230285-R issued by the FBR on November 23, 2022, which has asked to pay further tax at 3 per cent on sale of drugs to unregistered persons.

    READ MORE: Customs Intelligence Gwadar auctions motor vehicles on December 12

    The tax bar said clarification and its directions are contradictory to the legal position. It is being re-iterated that Serial No.81 in Table-1 of the Eighth Schedule to the Act categorically states that tax collected and discharged by the manufacturer of drugs under the Drugs Act, 1976 is final discharge of tax for the entire supply chain.

    Therefore, if further tax is asked to be levied on sale by the manufacturer/importer, it stands exactly opposite to the substantive law for declaring collection and discharge of tax by manufacturer/importer as final tax.

    READ MORE: Separate property declaration under Section 7E only for returns already filed

    “Needless to mention that the term ‘final tax’ in itself implies that no further collection of tax would be made under the Act irrespective of the nature/class/category/registration status of a person,” the tax bar added.

    The FBR chairman has been urged that above clarification may be re-clarified in the light of decisions given by higher courts and Appellate Tribunal.

    The position taken by the FBR yet for the second time and too knowingly, on the same issue, does not signify anything and is uncalled for on the part of Regulator. It is apprehended that the matter will yet again land in High Courts and will not yield anything but unnecessary and avoidable litigation.

  • Non-filers will not be included in ATL 2022

    Non-filers will not be included in ATL 2022

    KARACHI: Non-filers of income tax return will not be included in the Active Taxpayers List (ATL) 2022, officials in the Federal Board of Revenue (FBR) said.

    The last date for filing income tax returns for tax year 2022 is December 2022. The date has already been extended twice. The actual last date for filing income tax return for tax year 2022 was September 30, 2022. But it was extended up to October 31, 2022 and then up to November 30, 2022.

    READ MORE: FBR directs BS-21 officers to submit declaration of assets

    The FBR officials said that according to tax laws persons failing to file annual returns would not be included in the ATL.

    The ATL for tax year 2022 will be issued on March 01, 2023.

    Section 182A of the Income Tax Ordinance, 2001 explained repercussions of return not filed within due date.

    READ MORE: Customs Intelligence Gwadar auctions motor vehicles on December 12

    The text of the section is as follow:

    182A. Return not filed within due date.—(1) Notwithstanding anything contained in this Ordinance, where a person fails to file a return of income under section 114 by the due date as specified in section 118 or by the date as extended by the Board under section 214A or extended by the Commissioner under section 119, as the case may be, such person shall—

    (a) not be included in the active taxpayers’ list for the year for which return was not filed within the due date:

    READ MORE: Separate property declaration under Section 7E only for returns already filed

    Provided that without prejudice to any other liability under this Ordinance, the person shall be included in the active taxpayer ‘ list on filing return after the due date, if the person pays surcharge at Rupees-

    (i) twenty thousand in case of a company;

    (ii) ten thousand in case of an association of persons;

    (iii) one thousand in case of an individual.

    “Explanation.—For the removal of doubt it is clarified that the provisions of this section shall apply from tax year 2018 and onwards for which the first Active Taxpayers List is to be issued on first day of March, 2019 under Income Tax Rules, 2002; and

    READ MORE: Tax on deemed income from immovable property under Section 7E

    (b) not be allowed, for that tax year, to carry forward any loss under Part VIII of Chapter IV;

    (c) not be issued refund during the period the person is not included in the active taxpayers’ list; and

    (d) not be entitled to additional payment for delayed refund under section 171 and the period the person is not included in the active taxpayers’ list, shall not be counted for computation of additional payment for delayed refund.

  • FBR directs BS-21 officers to submit declaration of assets

    FBR directs BS-21 officers to submit declaration of assets

    ISLAMABAD: Federal Board of Revenue (FBR) has directed BS-21 officers to submit their declaration of assets otherwise their names will not be considered for promotion to next grade.

    In an official communication issued on Monday, the FBR directed BS-21 officers of Inland Revenue Service (IRS) and Pakistan Customs Service (PCS), who are in promotion zone, to ensure completion of their Performance Evaluation Reports (PERs) and Declaration of Assets.

    READ MORE: Customs Intelligence Gwadar auctions motor vehicles on December 12

    The FBR said the Establishment Division has informed that a meeting of high powered selection board (HPSB) for promotion to BS-22, is scheduled to be held shortly and cases for the promotion shall be submitted to the Establishment Division for HPSB by December 10, 2022.

    All the BS-21 officers of IRS and PCS in the promotion zone are directed to ensure that their PERs and Declaration of Assets up to June 30, 2022 are submitted to the Board latest by December 09, 2022, positively.

    READ MORE: Separate property declaration under Section 7E only for returns already filed

    Completion of PERs and submission of Declaration of Assets are the pre-requisites for promotion to selection grades under Civil Servants (Promotion to the post of Secretary BS-22 and equivalent) Rules, 2010.

    READ MORE: Tax on deemed income from immovable property under Section 7E

    The FBR is trying hard to ensure that all eligible officers should be considered for promotion in the forthcoming HPSB meeting. However, cooperation from the officers in timely completion of service record is equally essential.

    The revenue body warned that any officer who fails to furnish the documents by due date of December 09, 2022 will himself/herself be responsible for non-consideration / deferment / supersession.

    READ MORE: Supreme Court discourages taxpayers seeking relief in show cause notices

  • FBR nominates focal persons for resolving issues of IT industry

    FBR nominates focal persons for resolving issues of IT industry

    ISLAMABAD: Federal Board of Revenue (FBR) has nominated focal persons for resolving issues related IT industry.

    The following chief commissioners Inland Revenue (by designation) are nominated as focal persons for resolving problems and issues related to IT industry for the regions mentioned against each:

    Chief Commissioners – IR, Corporate Tax Office (CTO), Lahore, Islamabad and Karachi have been nominated as focal person for resolving problems and issues related to IT Industry regarding matter pertaining to Inland Revenue field formations within Lahore, Islamabad & Rawalpindi and Karachi.

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

    In October 2022, FBR Chairman Asim Ahmad 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.

    “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.

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

    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.

    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: Tax rates on goods, passenger transport vehicles 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: FBR notifies tax rates on brokerage, commission during 2022-2023

  • Pakistan sets up commission to eradicate black economy

    Pakistan sets up commission to eradicate black economy

    Pakistan has constituted a high powered commission for making suggestion to end the black economy or parallel economy. Finance Minister Ishaq Dar last week constituted a high powered tax commission for identifying bottlenecks in tax system and recommending pro-economic policies.

    (more…)