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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.

  • CNIC condition on sales up to Rs100,000 relaxed to facilitate retailers: FBR

    CNIC condition on sales up to Rs100,000 relaxed to facilitate retailers: FBR

    ISLAMABAD: Federal Board of Revenue (FBR) has said that the retailers are not required to maintain information of Computerized National Identity Card (CNIC) of a consumer on sales not exceeding above Rs100,000.

    The FBR issued Sales Tax Circular No. 01 dated August 06, 2020 to explain changes brought to main statute through Finance Act, 2020.

    The revenue body said that through the Finance Act 2019, Section 23 of Sales Tax Act, 1990 was amended by inserting the condition of mentioning of CNIC of the unregistered purchaser on the invoice.

    The measure was introduced to broaden the income as well as sales tax base.

    However, in case of supplies by a retailer to end consumers, the requirement was applicable if the transaction value exceeded Rs50,000.

    “Many representations were received stating that the retailers are facing hardship in obtaining CNIC of the buyers/ customers,” the FBR said.

    Hence, amendment in section 23 has been made for enhancing the threshold from Rs50,000 to Rs100,000.

    “Now, it would not be compulsory for the retailers to mention NIC of buyer if transaction value does not exceed Rs100,000 where supply is made to an ordinary consumer,” the FBR added.

  • Withholding tax rates on prizes, winnings updated

    Withholding tax rates on prizes, winnings updated

    ISLAMABAD: Federal Board of Revenue (FBR) has updated withholding tax rate on prizes and winnings for tax year 2021.

    The FBR issued withholding tax card 2020-2021 updated up to (June 30, 2020) after incorporating amendments made to Income Tax Ordinance, 2001 through Finance Act, 2020.

    Under Section 156 of Income Tax Ordinance, 2001 every person making payment shall deduct / collect withholding tax from recipient of prize or winnings at the time the prize or winnings are actually paid.

    The withholding tax rate is 15 percent of the gross amount on payment made for prize on quiz, bond and cross word. The tax rate shall be increased by 100 percent in case recipients of prize money is not on the Active Taxpayers List (ATL).

    The tax rate shall be 20 percent of the gross amount on payment on winning from a raffle, lottery, prize on winning a quiz, prize, offered by companies for promotion of sales crossword or puzzles. The tax rate shall be increased by 100 percent in case the recipient of amount is not on the ATL.

    The tax deducted/collected under this under shall be treated as final tax.

    Under Section 156A, every person selling petroleum products to petrol pump operator shall collect withholding tax from petrol pump operators at the time the commission is actually paid.

    The rate of withholding tax shall be 12 percent of the gross amount on payment to petrol pump operator on account of sale of petroleum products. The rate shall be increased by 100 percent in case person is not on the ATL.

    The tax shall be treated as final tax under this head.

  • FBR notifies major reshuffle; 43 BS-19-21 IR officers transferred

    FBR notifies major reshuffle; 43 BS-19-21 IR officers transferred

    ISLAMABAD: Federal Board of Revenue (FBR) on Saturday notified major reshuffle of senior Inland Revenue officers and transferred/posted 43 officers of BS-19 to BS-21 with immediate effect and until further orders.

    The following officers have been transferred and posted in the latest reshuffle:

    01. Mrs. Attiya Naheed Hakeem (Inland Revenue Service/BS-21) has been transferred and posted as Member, Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, Regional Tax Office, Islamabad.

    02. Malik Amjad Zubair Tiwana (Inland Revenue Service/BS-20) has been transferred and posted as Chief, Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, (IP/TFD/HRM) Large Taxpayers Unit, Islamabad.

    03. Syeda Naureen Zahra (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-VI) Corporate Regional Tax Office, Lahore from the post of Commissioner, (Zone-II) Corporate Regional Tax Office, Lahore.

    04. Muhammad Irfan Raza (Inland Revenue Service/BS-20) has been transferred and posted as Director, Directorate of Internal Audit (Inland Revenue), Lahore from the post of Commissioner, (Zone-VI) Corporate Regional Tax Office, Lahore.

    05. Muzaffar Ali Soomro (Inland Revenue Service/BS-20) has been transferred and posted as Director, Directorate of Law, Karachi from the post of Commissioner, (WHT) Regional Tax Office, Quetta.

    06. Amjad Farooq (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Audit-I) Large Taxpayers Unit, Lahore from the post of Commissioner, (Zone-II) Large Taxpayers Unit, Lahore.

    07. Muhammad Azhar Ansari (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Special Zone Builders and Developers) Large Taxpayers Unit-II, Karachi from the post of Commissioner, (Zone-III) Large Taxpayers Unit-II, Karachi.

    08. Sajjad Akbar Khan (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Audit-II) Large Taxpayers Unit, Karachi from the post of Commissioner, Inland Revenue (Appeals-I), Karachi.

    09. Zafar Iqbal Khan (Inland Revenue Service/BS-20) has been transferred and posted as Director, (HQ) Directorate General of Intelligence & Investigation (Inland Revenue), Islamabad from the post of Commissioner, (Corporate Zone) Regional Tax Office, Rawalpindi.

    The officer is also assigned the additional charge of the post of Director, Intelligence & Investigation (IR), Islamabad till the posting of a regular incumbent.

    10. Muhammad Jamil Bhatti (Inland Revenue Service/BS-20) has been transferred and posted as Director-I, Directorate of Law, Lahore from the post of Commissioner, Inland Revenue (Appeals-III), Lahore.

    11. Abdul Rehman Bullo (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-III) Large Taxpayers Unit-II, Karachi from the post of Commissioner, (IP/TFD/HRM) Large Taxpayers Unit-II, Karachi.

    12. Zahoor Ahmad Panwar (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-II) Corporate Regional Tax Office, Karachi from the post of Commissioner, (Zone-II) Regional Tax Office, Hyderabad.

    13. Ms. Mufeeza Iqbal (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-V) Corporate Regional Tax Office, Lahore from the post of Director, Directorate General of Training & Research (Inland Revenue), Lahore.

    14. Dr. Tariq Ghani (Inland Revenue Service/BS-20) has been transferred and posted as Director, Directorate of Internal Audit (Inland Revenue), Karachi from the post of Chief, (Management) Federal Board of Revenue (Hq), Islamabad.

    15. Ms. Sumbal Agha (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Legal) Large Taxpayers Unit, Lahore from the post of Commissioner, (Zone-I) Large Taxpayers Unit, Lahore.

    16. Aftab Alam (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Enforcement) Large Taxpayers Unit, Lahore from the post of Director, Directorate General of Training & Research (Inland Revenue), Lahore.

    17. Imran Munir (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-III) Corporate Regional Tax Office, Lahore from the post of Commissioner, Inland Revenue (Appeals-II), Lahore.

    18. Ms. Asma Aftab (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Audit-I) Large Taxpayers Unit, Karachi from the post of Commissioner, (IP/TFD/HRM) Large Taxpayers Unit, Karachi.

    19. Qazi Hifzur Rehman (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Audit-III) Large Taxpayers Unit, Karachi from the post of Commissioner, (Zone-II) Large Taxpayers Unit, Karachi.

    20. Syed Shakeel Ahmad (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Legal) Large Taxpayers Unit, Karachi from the post of Commissioner, Corporate Regional Tax Office, Karachi.

    21. Abdul Hameed (Inland Revenue Service/BS-20) has been transferred and posted as Chief, Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, Inland Revenue (Appeals-II), Islamabad.

    22. Ms. Ayesha Imran Butt (Inland Revenue Service/BS-20) has been transferred and posted as Director-II, Directorate of Law, Lahore from the post of Commissioner, Inland Revenue (Appeals-VII), Lahore.

    23. Faisal Rauf Memon (Inland Revenue Service/BS-20) has been transferred and posted as Director, Directorate of Intelligence & Investigation (Inland Revenue), Hyderabad from the post of Commissioner, (Zone-V) Large Taxpayers Unit, Karachi.

    24. Imtiaz Ahmad (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-II) Corporate Regional Tax Office, Lahore from the post of Commissioner, (Zone-IV) Large Taxpayers Unit, Lahore.

    25. Zafar Rafiq Siddiqui (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-I) Corporate Regional Tax Office, Karachi from the post of Commissioner, (Zone-V) Corporate Regional Tax Office, Karachi.

    26. Muhammad Ali (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-VI) Corporate Regional Tax Office, Karachi from the post of Commissioner, (Zone-I) Regional Tax Office III, Karachi.

    27. Ms. Shabana Mumtaz (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Legal) Large Taxpayers Unit, Islamabad from the post of Commissioner, (West Zone-III) Regional Tax Office, Islamabad.

    28. Shabih-ul-Aijaz (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Audit-II) Large Taxpayers Unit, Lahore from the post of Commissioner, (Zone-III) Large Taxpayers Unit, Lahore.

    29. Zulfiqar Ali Syed (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Enforcement-II) Large Taxpayers Unit, Karachi from the post of Commissioner, (Zone-I) Large Taxpayers Unit-II, Karachi.

    30. Muhammad Javaid Badar (Inland Revenue Service/BS-20) has been transferred and posted as Chief, Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, Inland Revenue (Appeals-II), Faisalabad.

    31. Ejaz Ahmad Bajwa (Inland Revenue Service/BS-20) has been transferred and posted as Chief, (Management) Federal Board of Revenue (Hq), Islamabad from the post of Chief, (Chief Transfer Pricing Unit) Federal Board of Revenue (Hq), Islamabad.

    32. S. Jaffar Raza Kazmi (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-V) Corporate Regional Tax Office, Karachi from the post of Commissioner, (WHT) Regional Tax Office, Sukkur.

    33. Jamshed Fakhri Dahir (Inland Revenue Service/BS-20) has been transferred and posted as Director, Directorate General of Training & Research (Inland Revenue), Lahore from the post of Commissioner, (Zone-III) Large Taxpayers Unit, Islamabad.

    34. Girdhari Mal Maghwar (Inland Revenue Service/BS-20) has been transferred and posted as Chief, (Transfer Pricing Unit) Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, (Zone-III) Large Taxpayers Unit, Karachi.

    35. Pir Khalid Ahmed Qureshi (Inland Revenue Service/BS-20) has been transferred and posted as Chief, Federal Board of Revenue (Hq), Islamabad from the post of Director, Directorate of Intelligence & Investigation (Inland Revenue), Hyderabad.

    36. Zia Agro (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Audit-I) Large Taxpayers Unit, Islamabad from the post of Commissioner, (Zone-I) Large Taxpayers Unit, Karachi.

    37. Naeem Hassan (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Audit-II) Large Taxpayers Unit, Islamabad from teh post of Commissioner, (Zone-IV) Large Taxpayers Unit, Islamabad.

    38. Abdul Waheed Khan (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Enforcement) Large Taxpayers Unit, Islamabad from the post of Commissioner, (East Zone-II) Regional Tax Office, Islamabad.

    39. Abdul Hafeez (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-I) Large Taxpayers Unit-II, Karachi from the post of Commissioner, (Special Zone for Builders and Developers) Large Taxpayers Unit-II, Karachi.

    40. Hammal Baloch (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Zone-IV) Large Taxpayers Unit-II, Karachi from the post of Commissioner, (Zone-III) Regional Tax Office III, Karachi.

    41. Abdul Hameed Shaikh (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Enforcement-I) Large Taxpayers Unit, Karachi from the post of Commissioner, (Zone-I) Corporate Regional Tax Office, Karachi.

    42. Muhammad Saleem (Inland Revenue Service/BS-19) has been transferred and posted as Chief, (OPS) Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, (OPS) (HRM) Regional Tax Office, Multan.

    43. Bashir Ahmed Kalwar (Inland Revenue Service/BS-19) has been transferred and posted as Chief, (OPS) Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, (OPS) Regional Tax Office, Sukkur.

    The FBR said that the officers who are drawing performance allowance prior to issuance of this notification shall continue to draw this allowance on the new place of posting.

  • FBR updates withholding tax rates for income from property

    FBR updates withholding tax rates for income from property

    ISLAMABAD: Federal Board of Revenue (FBR) has updated withholding tax on rental income from immovable properties for tax year 2021.

    The FBR updated the withholding tax card 2020-2021 after incorporating amendments to Income Tax Ordinance, 2001 made through Finance Act, 2020.

    The FBR said that every prescribed persons as per Section 155 of Income Tax Ordinance, 2001 shall collect / deduct withholding tax from recipient of rent of immovable property at the time the rent is actually paid.

    Section 155: Income from Property

    Any payment made on account of rent of immovable property

    (A) In case of individual or AOP

    1. Where the gross amount of rent does not exceed Rs, 200,000: the tax rate shall be zero

    2. Where the gross amount of rent exceeds Rs, 200,000 but does not exceed Rs, 600,000: 5 percent of the gross amount exceeding Rs, 200,000

    3. Where the gross amount of rent exceeds Rs, 600,000 but does not exceed Rs, 1,000,000: Rs, 20,000+10 percent of the gross amount exceeding Rs, 600,000

    4. Where the gross amount of rent exceeds Rs, 1,000,000 but does not exceed Rs, 2,000,000: Rs,60,000+15 percent of the gross amount exceeding Rs, 1,000,000

    5. Where the gross amount of rent exceeds Rs, 2,000,000 but does not exceed Rs. 4,000,000: Rs, 210,000+20 percent of the gross amount exceeding Rs, 2,000,000

    6. Where the gross amount of rent exceeds Rs.4,000,000 but does not exceeds Rs. 6,000,000: Rs.610,000 plus 25 per cent of the gross amount exceeding Rs.4,000,000

    7. Where the gross amount of rent exceeds Rs.6,000,000 but does not exceeds Rs. 8,000,000: Rs.1,110,000 plus 30 per cent of the gross amount exceeding Rs.6,000,000

    8. Where the gross amount of rent exceeds Rs.8,000,000: Rs.1,710,000 plus 35 percent of the gross amount exceeding Rs.8,000,000

    B) in case of company: 15 percent

    The tax shall be adjustable against total tax liability.

  • Withholding income tax rates for exporters updated

    Withholding income tax rates for exporters updated

    ISLAMABAD: Federal Board of Revenue (FBR) has updated withholding income tax rates for exporters for tax year 2021.

    The FBR updated withholding tax card for 2020/2021 after incorporating amendments made to Income Tax Ordinance, 2001 brought through Finance Act, 2020.

    Under Section 154 of Income Tax Ordinance, 2001 every authorized dealer in foreign exchange required to collect / deduct withholding tax from exporters at the time of realization of the export proceeds.

    The withholding tax rate under Section 154(1) shall be one percent of the gross value.

    The tax shall be final.

    Under Section 154(2) every authorized dealer in foreign exchange is required to collect/deduct withholding tax from non-export indenting agent, export indenting agent/export buying house at the time of realization of foreign exchange proceeds or indenting commission.

    The tax rate under this section shall be on realization of proceeds on account of commission to;

    I. Non-export indenting agent: 5 percent of gross value

    II. Export indenting agent / export buying house: 5 percent of gross value

    The tax shall be final tax liability.

    Under Section 154 (3), every banking company is required to collect/deduct tax from exporters at the time of realization of proceeds on account of sale of goods to an exporter.

    The tax rate shall be one percent on realization of proceeds on account of sale of goods to an exporter under inland back to back LC or any other arrangement as may be prescribed by FBR.

    The tax shall be final tax liability.

    Under Section 154 (3A), Export Processing Zone (EPZ) authority is required to collect / deduct withholding tax from industrial undertaking located in the export processing zone at the time of export of goods.

    The tax rate shall be one percent and this is final tax liability.

    Under Section 154(3B), direct exporters/export house registered under DTRE Rules 2001 required to collect/deduct withholding tax from indirect exporters (defined under sub-chapter 7 of the chapter XII of the Customs Rules, 2001) at the time of payment against a firm contract.

    The tax rate is one percent of the gross value and it is final tax liability.

    Under Section 154(3C), the collector of customs is required to collect withholding tax at one percent from exporter of goods at the time of export of goods. This tax shall be final tax liability.

  • FBR to get information of banking deposits, payments, profit on debt

    FBR to get information of banking deposits, payments, profit on debt

    ISLAMABAD: Federal Board of Revenue (FBR) to obtain information of deposits, payments and profit on debt of account holders from banking companies.

    According to news rules proposed through SRO 686(I)/2020 issued a day earlier, to be inserted into Income Tax Rules, 2020, the banks shall be required to furnish information in the manner as specified in account holders’ deposits statement, credit card payments statements, cash withdrawal statement and profit on debt statement.

    The new draft rules the FBR notified four different forms to obtain information of deposits, withdrawals, payment through credit cards and persons receiving profit on debt.

    The rules would help in obtaining information from banks under Section 165A of Income Tax Ordinance, 2001

    As per the amendment the banks shall provide information included: a list of persons containing particular of cash withdrawal aggregating to Rs one million or more during a month; list of persons depositing Rs10 million or more in a month; persons making payment through credit/debit card above Rs250,000 in a month.

    Under the new rules, the banks shall provide details of persons making deposits, withdrawal included: CNIC/NTN, name, address, account opening date, IBAN, resident/non-resident status etc.

    Under the new rules the banks shall be required to provide such information of deposits, withdrawal and payment through credit/debit cards on a monthly basis.

    However, the information of recipients of profit on debts shall be furnished within three months from the end of the financial year.

  • Authorities made duty bound to allow real-time access: FBR

    Authorities made duty bound to allow real-time access: FBR

    ISLAMABAD: Federal Board of Revenue (FBR) has said that after amendments made to sales tax and federal excise laws various authorities and organizations have been made duty bound to allow real-time access to tax authorities for preventing tax evasion.

    (more…)
  • CNIC made mandatory for recipient of services

    CNIC made mandatory for recipient of services

    ISLAMABAD: Federal Board of Revenue (FBR) has said that buyer’s CNIC (Computerized National Identity Card) detail is now mandatory on the invoice issued by seller for providing service in order avail credit.

    The FBR in its explanation of Sales Tax and Federal Excise through Circular No. 01 of 2020, stated the word “services” has been added along with goods to enlarge the scope of disallowance of input tax on account of non-mentioning of CNIC of the buyer by the seller on the invoice as required under section 23 of the 1990 Act.

    Resultantly, input tax claimed against goods as well as services shall be disallowed on pro rata basis if supplies have been made to persons without obtaining their CNIC/ NTN subject to the conditions mentioned in the law.

    The measure is expected to optimally broaden the sales tax base.

    The FBR explained that Following two changes have been made in subsection (7) of Section 3: The expression “by the buyers” has been omitted and after the word “persons” the expression “being purchaser of goods or services” has been added”.

    The first change is only clarificatory/consequential, however, the second change enlarges the scope of sales tax withholding by including purchase of services in the ambit of sales tax withholding regime.

  • FBR updates withholding tax rate on payment for goods, services

    FBR updates withholding tax rate on payment for goods, services

    ISLAMABAD: Federal Board of Revenue (FBR) has updated withholding tax rates on payments for goods and services during tax year 2021.

    The FBR updated withholding tax card 2020-2021 after incorporating amendments made to Income Tax Ordinance, 2001 through Finance Act, 2020.

    Under Section 153 of Income Tax Ordinance, 2001 every prescribed person shall collect withholding tax from resident person; Resident Person; and Permanent Establishment in Pakistan of a Non-Resident at the time the amount is actually paid for goods & services

    Under Section 153(1)(a) the tax rate for sale of rice, cotton seed oil and edible oil shall be 1.5 percent of the gross amount and the tax rate shall be increased by 100 percent in case persons are not on the Active Taxpayers List (ATL).

    The tax rate for supply made by distributors of fast moving consumer goods:

    In case of company 2 percent of gross amount

    Other than company the tax rate shall be 2.5 percent of gross amount

    The tax rate shall be increased by 100 percent in case persons are not on the ATL.

    Tax rate for supply made to Utility Stores Corporation of Pakistan:

    Persons (other than company) 1.5 percent of gross amount and the tax rate shall be increased by 100 percent in case persons are not on the ATL.

    Provided that the payment shall be made only in respect of supply of tea, spices, salt, dry milk, sugar, pulses wheat flour and ghee for the period commencing from the 7th day of April, 2020 and ending on 30th day of September, 2020

    Provided that this clause shall not be applicable to supply of tea, spices, salt and dry milk which are sold under a brand name.

    Provided further that this clause shall not be applicable where rate of tax under clause (a) of sub-section (1) of section 153 is less than 1.5% of the gross amount of payment under any provisions of the ordinance

    For sale of any other goods:

    In case of a company the tax rate shall be 4 percent of the gross amount.

    Other than company the tax rate shall be 4.5 percent of the gross amount

    The tax rate shall be increased by 100 percent in case persons are not on the ATL.

    The FBR said that in case of goods:

    No deduction of tax where payment is less than Rs. 75,000/- in aggregate during a financial year [S.153(1)(a)]

    The tax shall be minimum tax for all except in the following cases where it shall not be minimum tax on sale or supply of goods, by:

    (i) a company being manufacturers of such goods or

    (ii) Public company listed on registered Stock Exchange in Pakistan.

    Under Section 153(1)(b)

    Ever prescribed person shall collect withholding tax from resident person; Resident Person; and Permanent Establishment in Pakistan of a Non-Resident at the time the amount is actually paid

    i. Transport services, freight forwarding services, air cargo services, courier services, man power outsourcing services, hotel services, security guard services, software development services, IT Services and IT enabled services as defined in clause (133) of Part I of the Second Schedule, tracking services, advertising services (other than by print or electronic media), share registrar services, engineering services, car rental services, building maintenance services, services rendered by Pakistan Stock Exchange Ltd. & Pakistan Mercantile Exchange Ltd. , inspection, certification, testing & training services.;

    The tax rate shall be 3 percent of the gross amount and the rate shall be 6 percent in case persons not on the ATL.

    ii. In case of rendering or providing of services other than as mentioned at (i) above;

    a) In case of company 8 percent of the gross amount

    b) In any other case 10 percent of the gross amount

    c) In respect of persons making payment to electronic & print media for advertising services 1.5 percent of the gross amount

    The tax rate shall be increased by 100 percent in case persons are not on the ATL.

    The FBR said that in case of services:

    No deduction of tax where payment is less than Rs. 30,000/- in aggregate during a financial year [S.153(1)(b)]

    The tax shall be minimum tax.

    Under Section 153(1)(c)

    Every prescribed person shall collect / deduct withholding tax from resident person; Resident Person; and Permanent Establishment in Pakistan of a Non-Resident at the time the amount is actually paid.

    Execution of Contracts

    i) In case of sportsperson 10 percent

    ii) In the case of companies : 7 percent

    iii) In the case of persons other than companies 7.5 percent

    The tax rate shall be increased by 100 percent in case persons not on the ATL.

    Minimum Tax for all whereas it will remain adjustable where payments are received on account of execution of contracts by Public Company listed on registered Stock Exchange in Pakistan

    Under Section 153(2)

    Every exporter/export house shall collect/deduct withholding tax from resident person; Resident Person; and Permanent Establishment in Pakistan of a Non-Resident at the time of making the payment.

    Every Exporter or Export House shall deduct Tax on payments in respect of services of stitching, dying, printing etc. received/provided.

    1 percent of the gross amount and the rate shall be increased by 100 percent in case persons not on the ATL.

    The tax shall be minimum tax.

    Under Section 153B

    Every person paying an amount of royalty, in full or in part including by way of advance shall collect/deduct withholding tax from resident person at the time of making gross payment of royalty, in full or in part including by way of advance (including Federal Excise Duty and provincial sales tax, if any)

    Tax to be deducted on payment of royalty to resident person at 15 percent of the gross amount payable (including FED & Provincial Sales Tax, if any).

    The tax rate shall be increased by 100 percent in case persons not on the ATL.

    The tax withheld shall be adjustable.

  • Indemnity bond to be made mandatory for international transshipment facility

    Indemnity bond to be made mandatory for international transshipment facility

    ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday issued draft rules to make indemnity bond mandatory for shipping lines intending to use facility of international transshipment cargo within Pakistani sea ports.

    The FBR issued draft rules through SRO 685(I)/2020 to amend Customs Rules, 2001.

    According to the draft rules, shipping lines intending to use the facility of international transshipment would require to furnish an indemnity bond for an amount equal to the approximate value of goods expected to be imported in thirty days as security to ensure exit of goods outside the country within 30 days from the berthing of inward vessel.

    The FBR said that the indemnity bond would be forfeited apart from other consequential penal action under the Customs laws, if the shipping line misuses the facilitation of international transshipment.

    If goods still remain on the port after the expiry date including extended time allowed under the law, the shipping line would be responsible to remove the goods immediately unless the delay was attributed to the port authorities, the FBR added.

    According the draft rules the shipping lines would also liable to submit complete details of Import General Manifest (IGM).

    The shipping lines would require providing details, such as: port of loading; name of transshipment port of Pakistan; port of destination (final port of discharge at foreign destination); bill of lading number; name of foreign exporter; name of foreign importer; weight; seal number; and container number.