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.

Updated active taxpayers list grows to 3.59 million

ISLAMABAD: An updated list issued by the Federal Board of Revenue (FBR) on Monday revealed that the number of active taxpayers has grown to 3.59 million.

According to the latest Active Taxpayers List (ATL) the total number surged to 3,596,092 by October 16, 2022 for tax year 2021.

READ MORE: FBR gets 3.38 million active taxpayers by August 28, 2022

The ATL will also include names of those taxpayers who will file their income tax returns for the tax year 2021 in coming days till the ATL remained applicable.

The FBR issues ATL weekly basis on Monday to update the names of persons who filed their income tax returns during the week.

ATL provides taxpayers to get concession in payment of lower withholding tax rates or amount. The FBR issues ATL for the new tax year on the first day of March every year. Therefore, the existing ATL will prevail till February 28, 2023.

READ MORE: Tax rates on payments to non-residents during 2022-2023

According to the FBR the ATL is a central record of online Income Tax Return filers for the previous Tax Year.

It further says that ATL is published every financial year on the 1st March and is valid up to the last day of February of the next financial year. For example, Active Taxpayer List for Tax year 2020 was published on 1st March 2021 and will be valid till 28th February 2022. Similarly, Active Taxpayer List for Tax year 2021 will be published on 1st March 2022 and will be valid till 28th February 2023.

The ATL is updated on every Monday on the Federal Board of Revenue (FBR) website.

The FBR said that a person’s name will be part of the current ATL, if the Tax Return filed pertains to the Tax year of the relevant ATL. For example, to be part of the ATL published on 1st March 2021, a person must have filed a Tax return for the Tax year 2020. Similarly, to be a part of the ATL published on 1st March 2022, a person must have filed a Tax Return for the Tax year 2021.

READ MORE: Preventing currency smuggling top priority: FBR Chairman

Restriction on including a person’s name on ATL, if the person has not filed Tax Return by the due date specified by Income Tax authorities was introduced through Finance Act, 2018. For example, to be part of the ATL published on 1st March 2022, a person must file a Tax Return by the specified due date for the Tax year 2021.

However, through Finance Act, 2019 a person’s name can be part of ATL, even if the person has filed Tax Return after the due date specified by Income Tax authorities.

Furthermore, a surcharge for placement on ATL after due date of filing of Tax Return will be charged as under:

Company: Rs20,000

Association of Persons: Rs10,000

Individuals: Rs1,000

READ MORE: FBR collects Rs459 billion as sales tax on POL products in TY 2022

A company or an AOP shall be included in the ATL, whose return is not to be filed due to incorporation or formation after 30th day of June relevant to the Tax year pertaining to the ATL.

Joint account holders as an entity shall be deemed to be part of ATL if any of the persons in the joint account have met the criteria of being included in the ATL.

Bank account held in the name of a minor shall be considered part of ATL if the parents, guardians of the minor or any person who has deposited money in minor’s account are deemed to have met the criteria of being included in the ATL.

October 17, 2022
Tax rates on payments to non-residents during 2022-2023

The Federal Board of Revenue (FBR) has released the updated withholding tax card for the tax year 2023, applicable from July 1, 2022, to June 30, 2023. The revised rates specifically outline the tax obligations on payments to non-residents, following amendments introduced through the Finance Act, 2022, to the Income Tax Ordinance, 2001.
(more…)

October 16, 2022
Preventing currency smuggling top priority: FBR Chairman

ISLAMABAD: Asim Ahmad, Chairman, Federal Board of Revenue (FBR) has said that prevention of currency smuggling is top priority of Pakistan Customs.

The FBR chairman identified top priority arrears of the government to combat smuggling of currency, vehicles, and goods. Besides, prevention of mis-invoicing was also one of the top priorities, he added.

READ MORE: FBR collects Rs459 billion as sales tax on POL products in TY 2022

Asim Ahmad, Chairman, addressed the inaugural session of the quarterly coordination and performance review conference held recently of the Regional Directors of the Directorate General of Intelligence & Investigation-Customs; an important arm of the FBR.

The Chairman made it very clear that the Directorate General, I&I-Customs, had the capacity and competence to come up to the expectations with respect to each of these priority areas.

READ MORE: WHT share in direct taxes jumps to 67% despite omitting provisions

He assured the Director General, Faiz Ahmad Chadhar, that all possible resources required to achieve the desired results will be provided by FBR.

During the 12 hours long conference, each Regional Director gave a detailed presentation on the performance in the first quarter of FY 2022-23.

It covered major challenges hindering achievement of organizational goals, methods of information gathering, gaps in human resource and logistics as well as suggestions for further improvement.

READ MORE: Pakistan amends baggage rules; now $1,000 require declaration

In his closing remarks, the Director General directed the Regional Directors to focus on mis-invoicing not only in imports but also in exports, mis-use of exemption regimes, variation in pattern of transit trade viz a viz national imports and improving vigil along the borders.

He underscored the importance of improved liaison of the officers of Directorate General of I&I-Customs with national law enforcement agencies including Police, Rangers, FC, ANF, Provincial Excise Departments, other national intelligence agencies, and District Administration.

READ MORE: PTBA raises objections to amendments proposed by FBR

He also highlighted the need of coordination with the Chambers of Commerce and other trade bodies to have first-hand knowledge about their issues and grievances.

The Director General further emphasized that meeting the targets and expectations of FBR and the Federal Government with respect to smuggling, money laundering, and mis-invoicing will lead to creation of an enabling environment in the country for economic growth and investment.

October 16, 2022
FBR collects Rs459 billion as sales tax on POL products in TY 2022

The Federal Board of Revenue (FBR) has reported a substantial growth in sales tax collection on the import of Petroleum, Oil, and Lubricants (POL) products during the tax year 2022, reaching an impressive Rs459 billion.
(more…)

October 15, 2022
FBR announces prize winners of 10th POS balloting

ISLAMABAD: Federal Board of Revenue (FBR) on Saturday announced prize winners of 10^th balloting of invoices issued by point of sales (POS) of big retailers.

According to the FBR, the bumper prize of Rs1,000,000 has been awarded to Muhammad Imran on the invoice issued by Super Drugs.

READ MORE: FTO directs stop unlawful recovery from taxpayers’ bank accounts

The FBR announced winners of two second prizes of Rs500,000 each to Khawaja Fahd Naveed on the invoice issued by Bread and Beyond and Muhammad Yasir Ehsan on the invoice issued by Clinix.

Similarly, the four winners of third prize amounting Rs250,000 each have been awarded to Faiz Ahmed, Shahiryar khalid, Muhammad Sufyan and Mohsin Hassan.

The FBR conducts computerized balloting of invoices issued by Tier-1 retailers on every 15th day of a month. This was ninth draw as it was started in January 15, 2022.

READ MORE: FBR collects Rs196 billion as income tax from salaried class

The FBR encouraged people to actively participate in the balloting to win prizes after buying from POS integrated retailers.

The FBR previously issued a procedure for participating in the prize scheme.

The revenue body said that the customers of the integrated tier-1 retailers, whose names and CNICs are notified through random computerized draw shall be entitled to prizes in respect of their purchases from the integrated tier-1 retailers.

The customers shall verify the electronically generated invoice of integrated retailers either through the “tax asaan” application or by sending SMS to number 9966.

READ MORE: WHT share in direct taxes jumps to 67% despite omitting provisions

The application shall notify the customer regarding the status of the invoice either as “verified” or “unverified”.

In case of a verified invoice, the customer shall furnish one time, the following detail to the online system, namely:- Name; CNIC; and Mobile number.

Names and CNICs of the customers shall be included in the random computerized draw upon fulfillment of the requirement.

In case of an unverified invoice, the customer shall report the same through the system. The Board shall conduct inquiry and take appropriate action under the relevant provisions of law.

The computerized draw for the prizes shall be held in the first week of every month at the FBR Headquarters and the invoices of the immediately preceding month shall be entered in the draw.

Draw winners shall be required to perform biometric verification, at the nearest e-sahulat facility of NADRA and submit a scanned copy on the “tax assan” application. After successful biometric verification, winners shall be required to provide their IBAN through a “tax asaan” application.

The total prize money and the denomination of the prizes shall be decided on month to month basis by the Board.

October 15, 2022
FTO directs stop unlawful recovery from taxpayers’ bank accounts

Federal Tax Ombudsman (FTO) has directed the tax authorities to stop unlawful recovery from bank accounts of taxpayers.

The FTO issued the order dated September 30, 2022 in a complaint against non-issuance of refund amounting to Rs23.25 million for tax year 2016 along with compensation.

READ MORE: FTO investigates tax collection through electricity bills

According to the complainant, which is an Association of Person (AOP), filed return for tax year 2016. Later on, a tax office of the Federal Board of Revenue (FBR), amended the assessment order by making an addition of Rs1,754 million and rs164.21 million.

Being aggrieved, the complainant filed appeal before the Commissioner (Appeals), Gujranwala who modified the order and annulled the addition of Rs164 million, with the directions that the unit office for further necessary verification and confirmed the addition of Rs1,754 million.

READ MORE: President Alvi rejects FBR plea in maladministration cases

The tax office, recovered an amount of Rs23.25 million through attachment of bank accounts on the very next day without passing appeal effect order. Statedly, recovery was also made from bank accounts of some un-concerned persons.

The complainant filed appeal before appellate tribunal Lahore, who order granted stay order with certain observations.

The FTO in its findings revealed that the recovery of Rs23.25 million had been made from the complainant AOP and certain other unconcerned whereas no demand was in the field at the time of making such recovery. “This act of department tantamount to maladministration.”

READ MORE: FTO directs customs to clear pending auctions

It is also found that recovery from the bank accounts of unconcerned person is also an act which tantamount to maladministration.

The FTO in its recommendations to the FBR to ensure that an internal fact finding is conducted to see as who had recovered the amounts from bank account without giving appeal effect and without having legally recoverable tax demand on record.

READ MORE: KTBA passes resolution against FTO Asif Jah

FBR has been asked to issue clear directions to all field formations: forestalling unlawful recovery in the absence of any legally recoverable tax demand; and recovery from the accounts of unconcerned persons/entities.

October 13, 2022

FBR collects Rs196 billion as income tax from salaried class

ISLAMABAD: Federal Board of Revenue (FBR) has collected a huge amount of Rs196.25 billion as income tax from salaried class during tax year 2022.

A report issued by the FBR revealed that the collection of tax on salaried income recorded significant growth of 29 per cent, which compared with the collection of Rs151.84 billion in the preceding tax year.

Salaried tax is major revenue spinner in the collection of withholding tax. The collection of income tax on salaried income has been ranked third in the table of top revenue spinner under the withholding taxes.

The collection of withholding taxes from contracts and imports are on the first two slots. The FBR collected Rs341.42 billion with growth of 25.5 per cent from contracts and Rs281.61 billion with a growth of 29 per cent from imports during tax year 2022.

The recent revision in tax slabs in for the salaried class has been aimed to boost the revenue collection during the current fiscal year 2022/2023.

The FBR said that target for 2022-2023 is challenging given the fact that government is focusing on controlling the current account deficit and rising inflation which would result in import contraction and slowdown in the overall GDP growth.

Nonetheless, FBR is confident that its team has the ability and the resolve to accomplish this gigantic task as an upward revised target has already been achieved for the financial year ended on June 30, 2022.

To achieve the target several efforts are being made at policy as well as operational levels.

“There is focus on enhanced use of technology and a policy shift towards taxing the high-income groups through direct taxation such as the imposition of Super Tax, Poverty Alleviation Tax, revision of individual tax slabs including salaried class, increase in FED on international air travel, increased tax on luxury motor vehicles etc.,” the FBR added.

FOLLOWING IS THE TAX CARD FOR SALARIED PERSONS FOR TAX YEAR 2022-2023

Taxable Income	Rate of Tax
Up to Rs600,000	0%
Rs600,001 –1,200,000	2.5% of amount exceeding Rs600,000
Rs1,200,001 –2,400,000	Rs15,000 + 12.5% of amount exceeding Rs1,200,000
Rs2,400,001 –3,600,000	Rs165,000 + 20% of amount exceeding Rs2,400,000
Rs3,600,001 –6,000,000	Rs405,000 + 25% of amount exceeding Rs3,600,000
Rs6,000,001 –12,000,000	Rs1,005,000 + 32.5% of amount exceeding Rs6,000,000
Amount exceeding Rs12,000,000	Rs2,955,000 + 35% of amount exceeding Rs12,000,000

The rate of tax in the table above are applicable where the income of an individual chargeable under the head ‘salary’ exceeds seventy-five per cent of his/her taxable income.

October 12, 2022

WHT share in direct taxes jumps to 67% despite omitting provisions

ISLAMABAD: Share of withholding tax (WHT) collection in total collection of direct taxes has increased to 67 during Tax Year 2022 despite elimination of many provisions related to the withholding taxes.
(more…)

October 12, 2022
Pakistan amends baggage rules; now $1,000 require declaration

ISLAMABAD: Pakistan has amended baggage rules to make currency declaration of an amount $1,000 while taking out of the country to Afghanistan.

However, new slabs of currency declaration on the basis of age have also been announced.

The Federal Board of Revenue (FBR) issued SRO 1864(I)/2022 dated October 10, 2022 to make changes in the Baggage Rules, 2006.

READ MORE: PTBA raises objections to amendments proposed by FBR

As per the new changes to the baggage rules, the outbound passenger, for all countries except Afghanistan, without prejudice to his entitlement of taking out of Pakistan $1,000 up to the age of 5 years, $5,000 above 5 years, up to 18 years and $10,000 above the age of 18 years, while taking out of Pakistan foreign currency exceeding $5,000 or equivalent, or any other prohibited or restricted item, shall file a declaration before or on departure, electronically in the WeBOC or pass track or manually at the airport.

READ MORE: Pakistan’s tax to GDP ratio improves to 9.2 per cent in FY22: FBR

The FBR said that the persons travelling to Afghanistan, while having entitlement of $1,000, shall file a declaration of currency in their possession.

The incoming passenger when in possession of foreign currency exceeding $10,000 or equivalent, or any other prohibited or restricted item, shall also file a declaration.

READ MORE: Pakistan customs seals over 1,600 illegal petrol pumps during FY22

The FBR said that the declaration is also must for passengers carrying: Prohibited or restricted goods such as arms & ammunitions, narcotics, psychotropic substances or satellite phones etc; and gold and precious metals, jewelry, precious or semi-precious stones.

The declaration of foreign currency in US $/ Bearer Negotiable Instrument or equivalent is mandatory for outbound passengers to all countries except Afghanistan, taking out amount exceeding $5,000 or equivalent;

READ MORE: FBR directs IR offices to avoid recovery in pending appeals

For passengers traveling to Afghanistan, taking out cash foreign currencies US $ or equivalent; and Incoming passengers bringing into Pakistan amount exceeding $ 10,000 or equivalent.

October 12, 2022
PTBA raises objections to amendments proposed by FBR

ISLAMABAD: Pakistan Tax Bar Association (PTBA) has raised objections to amendments proposed in format as 16 million returns have already been filed for tax year 2022.

In a letter sent to the chairman of the Federal Board of Revenue (FBR) on Monday October 10, 2022, the PTBA submitted objections and suggestions on the proposed amendments to be made in the Second Schedule, in part-II-V, in the heading “Tax chargeable / payments” in the Income Tax Rules, 2002 as published vide S.R.O. 1829(1)/2022 dated October 03, 2022.

READ MORE: Pakistan’s tax to GDP ratio improves to 9.2 per cent in FY22: FBR

The PTBA said that amendment in the format of return had been proposed vide notification under S.R.O. 1829(1)/2022 dated October 03, 2022. Whereas, as per FBR declaration, returns above 16 million for the tax year 2022 have already been received. What would be the status of the said returns? Taxpayer in future may face undue litigations.

It is submitted that tax is charged on the net value of the capital assets whereas, no row has been provided to declare the amount of liabilities as well as net value of capital assets.

READ MORE: Pakistan customs seals over 1,600 illegal petrol pumps during FY22

PTBA said that the federation has no power to levy tax on agricultural income whether real or deemed as it is the domain of the provinces. “Every province of the country is charging Income Tax on the holding exceeding 12.5 Acres. The charge u/s 7E amounts to double tax,” it added

It is further submitted that self-owned agricultural land where agricultural activity is carried out by a person has been excluded under clause (C) of sub section (2) of section 7E. No column has been provided to claim exemption in this respect.

READ MORE: FBR directs IR offices to avoid recovery in pending appeals

It is not clear that whether a landlord who has leased out his agricultural property, is obliged to file the return, particularly, when he does not have any other source of income, except the agricultural income.

For the sake of brevity, the relevant section 41 of the income Tax Ordinance, 2001 is reproduced hereunder;

“S. 41. Agricultural Income.-

(1) Agricultural income derived by a person shall be exempt from tax under this Ordinance.

(2) In this section, “agricultural income” means, –

(a) any rent or revenue derived by a person from land which is situated in Pakistan and is used for agricultural purposes;

(b) any income derived by a person from land situated in Pakistan from –

(i) agriculture;

(ii) the performance by a cultivator or receiver of rent-in-kind of any process ordinarily employed by such person to render the produce raised or received by the person fit to be taken to market; or

(iii) the sale by a cultivator or receiver of rent-in-kind of the produce raised or received by such person, in respect of which no process has been performed other than a process of the nature described in sub-clause (ii); or

(c) any income derived by a person from –

(i) any building owned and occupied by the receiver of the rent or revenue of any land described in clause (a) or (b);

READ MORE: FBR directs 85 big retailers to integrate businesses

(ii) any building occupied by the cultivator, or the receiver of rent-in-kind, of any land in respect of which, or the produce of which, any operation specified in subclauses (ii) or (iii) of clause (b) is carried on, but only where the building is on, or in the immediate vicinity of the land and is a building which the receiver of the rent or revenue, or the cultivator, or the receiver of the rent-in-kind by reason of the person’s connection with the land, requires as a dwelling-house, a store-house, or other out-building.

The PTBA said that one Capital Asset owned by the resident person has been excluded from deeming income under clause (a) of sub section (2) of section 7E. But to claim such exemption no column has been provided in the proposed draft.

Furthermore, self-owned business premises (which may be more than one) from where the business is carried out by the person is excluded under clause (b) of sub section (2) of section 7E. No column to claim the said exemptions has been provided in the draft.

Likewise, to claim exemption under sub clauses (i), (ii), (iii) and (iv) of clause (d) of sub section (2) of section 7E, no column has been provided in the draft.

No space to claim exemptions under clauses (e), (f), (g), (h), (i) of sub section (2) of section 7E has been provided in the draft.

In order to claim the basic exemption of Rs. 25,000,000/- from the aggregate value of the Capital assets to be assessed u/s 7E, the space column may be provided.

It is suggested that the auto shifting data from wealth statement regarding immovable asset including its costs be made possible, to avoid extra labour of the tax consultants who are already facing a lot of burden and as well have a short time in filing tax returns.

October 10, 2022