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Tax experts at PwC A. F. Ferguson & Co. explained that for other than Tier – 1 retailers and specified service providers, a ‘final tax’ has been levied on the basis of gross amount billed for commercial electricity connections at the following rates:
Where the amount does not exceed Rs. 30,000: the tax shall be Rs3,000
The aforesaid tax shall be collected by the electricity companies through monthly bills in addition to withholding tax under section 235 of the Income Tax Ordinance, 2001.
However, in case sales tax is collected from such retailers through electricity bills under section 3(9) of Sales Tax Act, 1990, the sales tax will constitute discharge of tax liability under this section and thus no tax will be charged/ collected along with electricity bills.
The Federal Government is empowered to issue income tax general order for implementing this scheme and to specify service providers eligible for this regime.
3. Allowance for Pakistani nationals not availing transfer or residence: The following shall be various allowances for the Pakistani nationals not availing transfer of residence, namely:
A. Items of personal use allowed duty-free on any visit:
(i) personal wearing apparel and clothing accessories;
(iii) any other item except mobile phone, following allowances shall be admissible:
S. No.
Stay Abroad
Value of Duty Free allowance
(1)
(2)
(3)
(i)
Upto thirty days
Upto four hundred US Dollars (USD 400)
(ii)
Between thirty to sixty days
Upto eight hundred US Dollars (USD 800)
(iii)
More than sixty days
Upto twelve hundred US Dollars (USD 1200)
B. Purchases from a Duty Free Shop:
Duty free allowance of the aggregate value upto one hundred US dollars in case the goods are purchased from one of the duty free shops in Pakistan within sixty days of the arrival, and provided that the stay abroad of the passenger is more than sixty days.
The draft also recommended to substitute Rule 4 of the Baggage Rules, 2006, which is:
4. Allowance for Pakistani nationals availing transfer of residence:
A. Duty Free Allowance:
(i) personal household goods generally used by a family.
(ii) second hand or used professional equipment in use of a registered Pakistani practitioner during stay abroad, having proof of registration in the country abroad and duly recognized by the concerned regulatory authority or association:
Provided that an inspection certificate from an internationally recognized inspection agency in the exporting countries to the effect that such equipment is free from bacteria and other material injurious to human health, is furnished at the time of import of the equipment.
(iii) any other item (excluding mobile phones) of the value not exceeding fifteen hundred US dollars; and
(iv) weapon of non-prohibited bore for the personnel of armed forces, customs, police or any other law enforcement agency.
B. Purchases from a duty free shop:
Duty free allowances of the aggregate value upto fifteen hundred US dollars in case the goods are purchased from one of the duty free shops in Pakistan within sixty days of the arrival.
The draft rules amended table in Rule 5 of the Baggage Rules, 2006.
5. Special allowances for Foreign Exchange Remittance Card holders.— In addition to the allowances hereinbefore provided, the duty credit as specified in the Table below shall be admissible to a Pakistani national holding Foreign Exchange Remittance Card (FERC) once in a calendar year. The duty credit can also be utilized for the unaccompanied baggage or any purchase from one of the duty free shops. The duty credit under this scheme shall not be utilizable on import of vehicles.
The proposed amended table is as follow:
(1)
(2)
(3)
(4)
S.NO.
TYPE OF FERC
AMOUNT REMITTED THROUGH NORMAL BANKING CHANNEL (in US $ or equivalent foreign currency)
DUTY CREDIT IN PAKISTANI RUPEES
1.
Silver
2500 or more
20,000
2.
Silver Plus
5000 or more
40,000
3.
Golden
10,000 or more
60,000
4.
Golden Plus
25,000 or more
100,000
5.
Platinum
50,000 or more
200,000
The draft also recommended to substitute Rule 6 of the Baggage Rules, 2006, which is:
6. Allowance for foreign nationals and tourists: The following allowance shall be admissible to foreign national and tourist, namely:
(i) personal wearing apparel and clothing accessories; and
(ii) any other item (excluding mobile phones) of the value not exceeding eight hundred US dollars.
ISLAMABAD: The Federal Board of Revenue (FBR) has issued a list of 101 retailers and directed them to integrate by July 10, 2022 otherwise action will be taken as per law.
The FBR issued Sales Tax General Order (STGO) No. 1 of 2023 related to Tier-1 retailers for integration with FBR’s Point of Sale (POS) system.
The Finance Act, 2019 added sub-section (6) to section 8B of the Sales Tax Act, 1990 whereby a Tier-1 Retailers who did not integrate its retail outlet in the manner prescribed under sub-section (9A) of section 3 of the Sales Tax Act, 1990 during a tax period, its adjustable tax for that period would be reduced by 15 per cent. The figure of 15 per cent has been raised to 60 per cent vide Finance Act, 2021.
In order to operationalize this important provision of law, a system-based approach has been adopted whereby all Tier-1 Retailers who are liable to integrate but have not yet integrated, with effect from July-2021 (Sales Tax Returns filed in August, 2021) are to be dealt with as per the procedure laid down in STGO No/ 1 of 2022 issued on August 3, 2021.
Vide the instant Sales Tax General Order, a list of 101 identified Tier-1 Retailers has been placed on FBR’s web portal allowing them to integrate with FBR’s system by July 10, 2022 an the procedure of exclusion from this list of 101 identified Tier-1 Retailers shall apply as laid down in STGO 17 of 2022 dated May 13, 2022.
Upon filing of Sales Tax Return for the month of June, 2022 for all hereby notified Tier-1 Retailers not having yet integrated, their input tax claim would be disallowed as above, without any further notice or proceedings, creating tax demand by the same amount.
The Federal Board of Revenue (FBR) in Pakistan has officially released the income tax return forms for companies for the tax year 2022, signaling the commencement of the annual tax filing season.
The Federal Board of Revenue (FBR) has taken a significant step towards initiating the annual tax filing process by issuing income tax return forms for business individuals for the tax year 2022.
The Federal Board of Revenue (FBR) has taken a significant step towards enhancing tax transparency by releasing income tax return forms for Association of Persons (AOPs) for the tax year 2022.
The Federal Board of Revenue (FBR) has taken a significant step in facilitating tax compliance by issuing income tax return forms specifically tailored for salaried individuals for the tax year 2022.
ISLAMABAD: Pakistan has allowed exemption of customs duty on import of coal from Afghanistan.
The country’s apex revenue authority i.e. Federal Board of Revenue (FBR) issued SRO 968(I)/2022 to exempt customs duty on import of certain items, including coal from Afghanistan.
Earlier this week Prime Minister Muhammad Shehbaz Sharif approved the import of super-critical quality coal from Afghanistan in Pakistani rupee instead of dollars to help generate low-cost electricity in the country.
The prime minister, chairing a meeting to improve the mechanism for transportation of Afghan coal, expressed concerns over the rising price of coal in the international market.
He said the rise in coal price was also one of the reasons behind the generation of expensive electricity by the coal power plants operating in the country.
He viewed that the import of Afghan coal in Pakistani currency would save the foreign exchange.
The prime minister was told that the import of Afghan coal – initially for Sahiwal and Hub power plants – would save around $2.2 billion annually.
ISLAMABAD: Pakistan on Friday opened the income tax return filing portal for tax year 2022. The return filing portal will remained available till September 30, 2022, as three months are statutory time period for filing income tax return.
Salaried persons, business individuals, Association of Persons (AOPs) and Companies having special account year will file the income tax return during this period.
The Federal Board of Revenue (FBR) issued SRO 978(I)/2022 to notify finalized income tax return form for the tax year 2022.
Following are the categories of taxpayers who required to file income tax return for tax year 2022 under Income Tax Ordinance, 2001:
Section 14 of Income Tax Ordinance, 2001 has explained in detail about persons whom the annual return filing is mandatory. According to the Section:
114. Return of income. — (1) Subject to this Ordinance, the following persons are required to furnish a return of income for a tax year, namely:–
(a) every company;
(ab) every person (other than a company) whose taxable income for the year exceeds the maximum amount that is not chargeable to tax under this Ordinance for the year; or
(ac) any non-profit organization as defined in clause (36) of section 2;
(ae) every person whose income for the year is subject to final taxation under any provision of this Ordinance;
(b) any person not covered by clause (a), (ab), (ac) or (ad) who,—
(i) has been charged to tax in respect of any of the two preceding tax years;
(ii) claims a loss carried forward under this Ordinance for a tax year;
(iii) owns immovable property with a land area of five hundred square yards or more or owns any flat located in areas falling within the municipal limits existing immediately before the commencement of Local Government laws in the provinces; or areas in a Cantonment; or the Islamabad Capital Territory;
(iv) owns immoveable property with a land area of five hundred square yards or more located in a rating area;
(v) owns a flat having covered area of two thousand square feet or more located in a rating area;
(vi) owns a motor vehicle having engine capacity above 1000 CC;
(viii) is the holder of commercial or industrial connection of electricity where the amount of annual bill exceeds rupees five hundred thousand;
(ix) is a resident person registered with any chamber of commerce and industry or any trade or business association or any market committee or any professional body including Pakistan Engineering Council, Pakistan Medical and Dental Council, Pakistan Bar Council or any Provincial Bar Council, Institute of Chartered Accountants of Pakistan or Institute of Cost and Management Accountants of Pakistan; or
(x) is a resident person being an individual required to file foreign income and assets statement under section 116A.
(c) persons or classes of persons notified by the Board with the approval of the Minister in-charge.
(1A) Every individual whose income under the head ‘Income from business’ exceeds rupees three hundred thousand but does not exceed rupees four hundred thousand in a tax year is also required to furnish return of income from the tax year.
The LTO Karachi has also surpassed the budgetary target fixed at Rs.170 billion during the month June 2022, by collecting a massive amount of Rs.196 billion in all taxes.
Large Taxpayers Office, Karachi has shown remarkable achievement by collecting Revenue at Rs.1,595 billion in all taxes during the period July 2021 – June 2022 as against Rs.1,124 billion collected previous year showing an overall growth of 42 percent vis-à-vis overall collection made during the same period last year.
Overall budget target assigned to LTO Karachi by the Federal Government for the period July 2021 to July 2022 was Rs.1,449 billion against which LTO Karachi has achieved Rs.1,595 billion which is Rs.146 billion in excess of the assigned target.
During the month of June 2022, Large Taxpayers Office, Karachi (Federal Board of Revenue) has also surpassed budgetary target fixed at Rs.170 billion by collecting gigantic Rs.196 billion (all taxes) against the target fixed by the Government.
