The Federal Board of Revenue (FBR) has issued revised rates for advance tax on the registration or transfer of motor car.
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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.
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Tax credit for capital investment in specified sectors
Section 65G of Income Tax Ordinance, 2001 has allowed tax credit for capital investment in specified industrial undertakings.
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Law allows certain persons to avail tax credit
Section 65F of Income Tax Ordinance, 2001 has allowed tax credit for certain persons against their incomes.
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Tax credit for establishing industrial undertaking
Tax credit for establishing industrial undertaking has been clarified by the Federal Board of Revenue (FBR) to facilitate the business community.
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Tax incentive for companies on purchase of machinery
Tax incentive for companies on purchase of machinery and expansion has been clarified by the Federal Board of Revenue (FBR).
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Tax credits for various provisions of law
Tax credits for various provisions of law have outlined by the Federal Board of Revenue (FBR) as explained under Section 65 of the Income Tax Ordinance, 2001.
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FBR explains taxation of erstwhile FATA/PATA industries
ISLAMABAD: The Federal Board of Revenue (FBR) has explained tax treatment of erstwhile FATA/PATA domiciled industries after amendment brought through Finance Act, 2021.
The FBR in a circular No. 03 issued on Tuesday said a number of significant amendments have been introduced through Finance Act, 2021 in the Sales Tax Act, 1990 as applicable to various industries located in erstwhile FATA/PATA regions.
The most important change brought about by the Finance Act 2021, is vis-A-vis the new entry No. 74 added in 8th Schedule to the Sales Tax Act, 1990, to charge sales tax at the rate of 16 per cent on all “goods supplied from tax-exempt areas of erstwhile FATA/PATA to the taxable areas.”
Accordingly, a FATA/PATA-domiciled person having status of “active taxpayer” in terms of Section 2(1) of the Sales Tax Act, 1990 would continue to import raw materials for consumption at his own manufacturing site against deposit of post-dated cheques (PDC) in line with its determined installed production capacity.
The importation, transportation, exemption (from import-stage income tax), and consumption of raw materials have been elaborately dealt with vide FBR‘s CGO # 1 of 2021, Circular # 5 of 2021, Circular # 9 of 2021 and Circular No.13 of 2021, which continue to be applicable.
In order to facilitate the operationalization of benefits laid down in the law, the FATA/PATA-domiciled industrial units may acquire installed capacity determination certificate (ICDC) from the Khyber Pakhtunkhwa Department of Industries or the Ministry of Industries, Government of Pakistan.
The Commissioner concerned shall accept the ICDC presented until he has reasons to believe that the actual capacity installed is less than the capacity determined and certified.
“It goes without saying that only the goods meant for value addition are to be imported and not finished products,” the FBR said.
In order to undertake foolproof surveillance of exit points from non-taxable to taxable territories, Inland Revenue Enforcement Network (IREN) check posts under Section 40D of the Sales Tax Act, 1990 are being established and functionalized to ensure that due tax is paid at the rate of 16 per cent on goods supplied into taxable territories.
The Regional Tax Office (RTO), Peshawar shall also establish a tax office in Malakand Division for prompt release of consignments, processing of consumption and exemption certificates and effective and timely implementation of law in letter and spirit.
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Withholding tax rates on property income for 2021-2022
The Federal Board of Revenue (FBR) has issued updated rates of withholding tax on income from the property for the year 2021-2022.
The withholding tax shall be collected by every prescribed person from the recipients of rent of the immovable property.
The FBR collects withholding tax on income from property under Section 155 of the Income Tax Ordinance, 2001.
WITHHOLDING TAX CARD 2021/2022
Following are the rates of withholding tax:
Any payment made on account of rent of the immovable property
(A) In case of individual or Association of Person (AOP):
1. Where the gross amount of rent does not exceed Rs, 300,000: There shall be no tax.
2. Where the gross amount of rent exceeds Rs, 300,000 but does not exceed Rs, 600,000: the tax rate shall be 5 per cent of the gross amount exceeding Rs, 300,000.
3. Where the gross amount of rent exceeds Rs. 600,000 but does not exceed Rs. 2,000,000: The tax rate shall be Rs. 15,000 plus 10 per cent of the gross amount exceeding Rs. 600, 000.
4. Where the gross amount of rent exceeds Rs. 2,000,000: the tax rate shall be Rs. 155,000 plus 25 per cent of the gross amount exceeding Rs. 2,000, 000.
B) in case of the company: the tax rate shall be 15 per cent.
The tax deducted under Section 155 of Income Tax Ordinance, 2001 is adjustable.
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Sales tax exemption granted to medical equipment
The Federal Board of Revenue (FBR) has granted sales tax exemption on the import of essential medical equipment. The FBR issued SRO 1007(I)/2021 on Monday, listing a comprehensive array of medical goods that will be exempted from sales tax, aiming to facilitate the procurement and availability of critical equipment.
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CTO Karachi seals three retail shops on POS failure
In a determined move to enforce compliance with the newly introduced Point of Sale (POS) integration system, a tax office of the Federal Board of Revenue (FBR) has taken stringent measures by sealing three retail shops in Karachi for failing to install POS machines.
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