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.

Nausheen Amjad removed from post of FBR chairperson

ISLAMABAD: The government on Saturday removed the chairperson of Federal Board of Revenue (FBR) Ms. Nausheen Javaid Amjad and assigned look after charge to another senior officer of Pakistan Customs Service (PCS) with immediate effect.

Ms. Nausheen Javaid Amjad was assigned the post of FBR chairperson on April 08, 2020 after the resignation of Syed Muhammad Shabbar Zaidi, who served as FBR Chairman from private sector during May 10, 2019 to April 08, 2020.

Sources said that the removal of Ms. Nausheen was linked to the tax profile of wife of Justice Qazi Faiz Essa. The sources said that Ms. Nausheen had not compromised the integrity of tax department.

The Establishment Division on Saturday issued a notification and assigned additional charge of the post of FBR Chairman to Muhammad Javed Ghani, a BS-22 officer of PCS, presently posted as Member, FBR, for a period of three months or till the posting /appointment of a regular incumbent, whichever is earlier, with immediate effect.

July 4, 2020
FBR extends date for retail outlet integration up to August 31

ISLAMABAD: Federal Board of Revenue (FBR) on Friday extended date for retailers to integrate their Point of Sale (POS) up to August 31, 2020.

The last date for integrating the POS for Tier-1 retailers was June 30, 2020.

The FBR said that only those retailers can integrate their POS by August 31 who submit their intention to RTOs/LTUs by August 20, 2020.

FBR sources said that the decision had been taken due to lockdown in the many parts of the country in order to prevent spread of coronavirus the business activities had become stand still.

They said that big outlets and shopping plazas are observing closure during the lockdown and many of those big retailers would not able to make compliance.

The deadline was expired on December 15, 2019 which was given by the FBR to tier-1 retailers to integrate their POSs with the FBR online system. However, the date was extended in order to give opportunity to big retailers to make compliance.

All tier-1 retailers are required to integrate all their POSs with FBR’s computerized system.

Tier-1 retailer is defined in section 2(43A) of the Sales Tax Act, 1990, to be a person who falls in any of the following categories:

(a) a retailer operating as a unit of a national or international chain of stores;

(b) a retailer operating in an air-conditioned shopping mall, plaza or centre, excluding kiosks;

(c) a retailer whose cumulative electricity bill during the immediately preceding twelve consecutive months exceeds Rupees twelve hundred thousand;

(d) a wholesaler-cum-retailer, engaged in bulk import and supply of consumer goods on wholesale basis to the retailers as well as on retail basis to the general body of the consumers; and

(e) a retailer, whose shop measures one thousand square feet in area or more.

July 4, 2020
Finance Act 2020: Commissioner empowered to cancel exemption certificate

ISLAMABAD: A commissioner of Inland Revenue has been authorized to cancel or modify exemption certificate issued automatically by online system IRIS.

Through Finance Act, 2020 amendment has been made to Section 153 of Income Tax Ordinance, 2001.

As per the amendment the commissioner of Inland Revenue of Federal Board of Revenue (FBR) is required to issue certificate to taxpayer within prescribed time frame. However, if application is filed by taxpayer and commissioner fails to take action than the IRIS will automatically issue certificate to the taxpayer.

However, the commissioner is empowered to modify or cancel the certificate on reasonable ground.

The amendment in this regard is as:

“Provided that the Commissioner shall issue certificate for payment under clause (a) of sub-section (1) without deduction of tax within fifteen days of filing of application to a public company listed on a registered stock exchange in Pakistan if advance tax liability has been discharged.

“Provided further that the Commissioner shall be deemed to have issued the exemption certificate upon the expiry of fifteen days to the aforesaid public listed company and the certificate shall be automatically processed and issued by Iris:

“Provided also that the Commissioner may modify or cancel the certificate issued automatically by IRIS on the basis of reasons to be recorded in writing after providing an opportunity of being heard.”

July 3, 2020
FBR exempts customs duty on oxygen gas, cylinder import

In response to the ongoing COVID-19 pandemic, the Federal Board of Revenue (FBR) announced on Wednesday an exemption from customs duty on the import of oxygen gas and oxygen gas cylinders. This measure aims to ensure the availability of these essential supplies as the country battles the spread of the virus.
(more…)

July 1, 2020
Security forces to provide monthly details of confiscated smuggled goods to FBR

ISLAMABAD: Security forces engaged in anti-smuggling activities to submit monthly seizure report to Federal Board of Revenue (FBR).

The FBR issued SRO 578, 579 and 580(I)/2020 to amend Customs Act, 1969 making it mandatory for security forces to furnish monthly report of seizure report to the customs authorities.

The FBR has entrusted Frontier Corps, Pakistan Rangers, Pakistan Maritime Security Agency and Pakistan Coast Guards to exercise the powers of customs authorities in preventing smuggling.

The Pakistan Rangers and Frontier Corps have been authorized to exercise powers of customs officials against smuggling since 2010. Meanwhile, Pakistan Maritime Security Agency and Pakistan Coast Guards was entrusted to exercise powers of customs officials since 2014.

The FBR every year extends the authority in the month of June. Through the latest SROs the FBR extended the powers till June 30, 2021.

As per the SROs the law enforcement agencies are required to provide details of seized goods/vehicles handed over to Pakistan Customs in a month to the Collector of Customs (Enforcement and Compliance) within their respective jurisdiction by 5^th day of each month.

July 1, 2020
FBR imposes up to seven percent additional customs duty

ISLAMABAD: Federal Board of Revenue (FBR) has started preparation for achieving revenue collection target for fiscal year 2020/2021 as it massively increased additional customs duty up to 7 percent from July 01, 2020.

The FBR issued SRO 572(I)/2020 on Tuesday for levying additional customs duty at different rates of two percent, four percent and seven percent.

The FBR provisionally collected Rs3.957 trillion for fiscal year 2019/2020. As per budget documents the FBR has been assigned to collect Rs4,963 billion during the fiscal year 2020/2021, which is around 25 percent higher than collection of fiscal year 2019/2020..

The government while presenting the budget 2020/2021 had claimed that the budget was tax free and it had not levied any duty and tax in order to provide relief to the masses amid outbreak of coronavirus.

However, as per the notification additional customs duty at two percent has been imposed on goods imported under tariff slabs of zero percent, three percent and 11 percent.

Another rate of four percent additional customs duty has been levied on goods imported under tariff slab of 16 percent.

While the rate additional customs duty at seven percent has been applied on goods imported under tariff slab of 20 percent and above.

However, import of edible crude oil which are subject to import at higher tariff slab, the additional customs duty shall be charged at the rate of two percent, the FBR said.

The FBR further said that additional customs duty would not be applicable on the goods imported under concessionary regime for exporters.

Further, the additional customs duty shall also not be applicable on the contractors and services companies for offshore projects.

June 30, 2020
FBR surpasses fiscal year 2019/2020 collection target

ISLAMABAD: Federal Board of Revenue (FBR) has surpassed revenue collection target of Rs3,907 billion for fiscal year 2019/2020, which was significantly lower due to coronavirus adverse impact on the economy.

FBR official spokesman on Tuesday said that the tax authorities had surpassed the downward revised target of Rs3,907 billion and collected Rs3,957 billion be Tuesday evening.

The spokesman said that the gross collection of the FBR also recorded above Rs4,000 billion for the first time in the history. The collection is considerably high considering the adverse impact of coronavirus.

The collection in the month of June 2020 also recorded at Rs411 billion by 3:00PM on June 30, 2020 as against the June target of Rs398 billion.

It is important to note that the FBR had lost around 30 officials due to the pandemic, which also included a grade 22 officer Muhammad Zahid Khokhar.

The FBR praised its officials for their dedication toward revenue collection despite threat of COVID.

June 30, 2020
FBR grants Rs30 billion as tax concession to new business entities

ISLAMABAD: Federal Board of Revenue (FBR) has granted Rs30 billion as initial allowance to new business entities during fiscal year 2019/2020.

The concession of allowance has been granted under Section 23 of Income Tax Ordinance, 2001.

As per Section 23 the allowance has been granted as:

Section 23. Initial allowance.—

Sub-Section (1): A person who places an eligible depreciable asset into service in Pakistan for the first time in a tax year shall be allowed a deduction (hereinafter referred to as an “initial allowance”) computed in accordance with sub-section (2), provided the asset is used by the person for the purposes of his business for the first time or the tax year in which commercial production is commenced, whichever is later.

Sub-Section (2): The amount of the initial allowance of a person shall be computed by applying the rate specified in Part II of the Third Schedule against the cost of the asset.

[The rate of initial allowance under section 23 shall be 25 percent for plant and machinery.]

Sub-Section (3): The rules in section 76 shall apply in determining the cost of an eligible depreciable asset for the purposes of this section.

Sub-Section (4): A deduction allowed under this section to a leasing company or an investment bank or a modaraba or a scheduled bank or a development finance institution in respect of assets owned by the leasing company or the investment bank or the modaraba or the scheduled bank or the development finance institution and leased to another person shall be deducted only against the leased rental income derived in respect of such assets.

(5) In this section, “eligible depreciable asset” means a depreciable asset other than —

(a) any road transport vehicle unless the vehicle is plying for hire;

(b) any furniture, including fittings;

(c) any plant or machinery that has been used previously in Pakistan; or

(d) any plant or machinery in relation to which a deduction has been allowed under another section of this Ordinance for the entire cost of the asset in the tax year in which the asset is acquired.

The FBR granted a sum of Rs36.43 billion as allowances including the initial allowance during fiscal year 2019/2020.

Under Section 23A an amount of Rs335 million has been granted as first year allowance under the head of industrial undertaking set up in specified rural and under developed areas or engaged in the manufacturing of cellular mobile phones.

An amount of Rs477 million has been granted concessions under Section 60 of the Income Tax Ordinance, 2001 for persons paying Zakat.

The FBR granted concession of Rs2.45 billion under Section 60A for persons paying Workers’ Welfare Fund. Another amount of Rs2.72 billion has been granted as allowance under Section 62B for persons paying workers’ participation fund.

An amount of Rs285 million has been granted as allowance under Section 60C for individuals paying profit or share in rent and share in appreciation for value of house on loan by banks etc.

The FBR granted Rs154 million as deductible allowance for education expenses under Section 60D.

June 30, 2020
FBR issues rules for processing duty drawback claims

ISLAMABAD: Federal Board of Revenue (FBR) on Monday issued draft rules for processing duty drawback claims in order to speedy repayment of exporters.

The FBR issued SRO 561(I)/2020 to amend Customs Rules, 2001 for processing and sanctioning of duty drawback claims.

The FBR said that the claims of duty drawback shall be sanctioned by the Customs if the same are complete in all respect and on first in first out (FIFO) basis.

However, comprehensive audit of duty drawback would be carried out by the Directorate General of Post Clearance Audit (PCA) of the FBR.

Any recovery detected by the PCA may be deducted from the next duty drawback claim of the exporter besides initiating recovery proceedings under the recovery rules.

The duty drawback payment of such claims that are complete in all respects shall be made on FIFO basis taking into account the date of filing of claim.

A consolidated discrepancy report shall be sent by the collectorate to State Bank of Pakistan (SBP) on monthly basis. The SBP shall also send a scroll of all the duty drawback payments made to the exporters.

For calculating amount of customs duties paid at the time of import, past six months import data may be used taking the average quantity or value of each class or description of the materials, including packing materials, from which a particular class or description of goods is ordinarily produced or manufactured. Average exchange rates of the same period may be taken into consideration.

The average amount of customs duties paid on imported materials used in the manufacturing of components, intermediate or semi-finished products which are exported as such or further used for manufacture of goods shall be taken into account for the purpose of calculation of the duty drawback.

The average amount of customs duties paid at the effective rate on the imported input materials shall be calculated for the last six months import data.

The average FOB (freight on board) value of each class or description of the goods exported during the last six months may be taken into consideration for the class or description of goods for which export drawback rates are being determined.

On requisition by the relevant association, director general may furnish trade statistics pertaining to each class or description of imported or exported goods for the past six months on the basis of which export drawback rates need to be determined.

At the time of submitting an application, the association shall specify the complete calculation in accordance with the method of calculation as the FBR may notify and shall also furnish therewith the worksheets.

The Director General may initiate exercise for determination of duty drawback rates on its own motion where it is found that: duty drawback rates have not been determined; where already determination rates have changed due to amendments in tariffs.

June 30, 2020
FBR grants Rs45 billion customs duty exemption under free trade agreements

In a significant move to bolster trade and economic relationships, the Federal Board of Revenue (FBR) has granted Rs45 billion in customs duty exemptions and concessions on imports under various Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) for the fiscal year 2019/2020.
(more…)

June 29, 2020