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.

Sectoral analysis shows massive decline in sales tax from OMCs

ISLAMABAD: Federal Board of Revenue (FBR) has conducted sectoral analysis to identify reasons behind shortfall in revenue collection. The analysis showed massive decline in sales tax from Oil Market Companies (OMCs) during July – January 2019/2020.

According to official documents, the collection of sales tax from OMCs was at Rs13.56 billion during first seven months of current fiscal year as compared with Rs18.94 billion in the corresponding period of the last year, showing 28 percent decline.

The fall in sales tax collection from OMCs is much higher than the decline in domestic sales of the oil market companies. The domestic oil sales fell by 10 percent to 10.14 million tons during the period under review as compared with 11.3 million tons in the same period of the last fiscal year.

The analysis also revealed that the collection of sales tax from iron and steel products declined by 29 percent to Rs4.93 billion as compared with Rs6.92 billion in the same period of the last fiscal year.

Similarly, the collection of sales tax from sales of motor cars fell by 43 percent to Rs2.22 billion during first seven months of the current fiscal year as compared with Rs3.86 billion in the corresponding period of the last fiscal year.

Reportedly, the FBR is facing huge shortfall in revenue collection to achieve current fiscal year revenue target. The FBR was assigned Rs5.55 trillion target at the start of current fiscal year. However, this target was revised downwards to Rs5.238 trillion.

The FBR provisionally collected Rs2,400 billion during first seven months of current fiscal year as compared with Rs2,067 billion in the same period of the last fiscal year.

The revenue authority is required another Rs2,828 billion in remaining five months to achieve the collection target.

The FBR conducted analysis of 11 sectors, which included: OMCs, Iron and Steel Products; natural gas; auto parts; motor cars; motor cycles; tea; ceramic tiles; pickle in oil; printing industries; and storage batteries.

All the above sectors have shown decline in sales tax during the period under review.

February 28, 2020
FBR to initiate action against non-filers after date expiry

KARACHI: Federal Board of Revenue (FBR) to initiate proceedings against persons failed to file income tax returns for tax year 2019 after expiry of return filing date i.e. February 28, 2020.

Sources in Federal Board of Revenue (FBR) on Thursday said that FBR unlikely to further extend the return filing date. The return filing date for tax year 2019 is expiring today i.e. Friday, February 28, 2020.

The sources said that tax authorities would identify persons who had filed their income tax returns for tax year 2018 but failed to file their returns for tax year 2019 despite grant of several extensions.

They said that the FBR would enforce returns and initiate legal proceedings against non-compliant taxpayers.

The last date for filing annual returns was September 30, 2019 for salaried persons, business individuals and Association of Persons (AOPs). While the last date for filing income tax returns for corporate entities was December 31, 2019.

The FBR while considering difficulties faced by taxpayers granted several extensions for filing tax returns and last was granted up to February 28, 2020.

The sources said that those persons who failed to file their returns would face penalty as prescribed under the Income Tax Ordinance, 2001.

Under Section 114 of Income Tax Ordinance, 2001 following persons/companies are required to file annual returns:

(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;

(ad) any welfare institution approved under clause (58) of Part I of the Second Schedule;

(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;

(vii) has obtained National Tax Number; or

(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) every resident person being an individual required to file foreign income and assets statement under section 116A.

(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.

February 28, 2020
FBR issues precautionary measures against coronavirus

ISLAMABAD: Federal Board of Revenue (FBR) on Thursday issued precautionary measures for tax officials to protect themselves against coronavirus and educate taxpayers and general public for prevention.

The FBR said that with the recent outbreak of coronavirus (COVID-19) in China, its subsequent spread across the globe and education of two confirmed cases in Pakistan, it is imperative that in line with the direction of the federal government, all officers and staff of FBR be educated on the cases, symptoms and prevention measures to protect themselves as well as to educate the taxpayers and general population about the same.

A compendium of causes, symptoms and prevention; complied from research of World Health Organization, the Center of Disease Control and Prevention (CDC-USA) and Ministry of National Health Service, Islamabad is summarized as under:

Causes: The coronavirus spreads primarily from person to person contact. CDC-USA attributes it to close contact (6 feet or less) with a person already infected. Prime cause of infection is through the airborne (water) droplets during sneezing and coughing of an already infected person.

Touching an area where an infected person has sneezed or coughed may also be avoided. Furthermore, it may spread from consuming uncooked or undercooked animal organ meat.

Summarized, Coronavirus spreads in similar way to flu. Persons at a higher age bracket and persons with weak/weakened immune system are at most risk.

Symptoms: The Coronavirus may manifest symptoms within 2 to 14 days after being contracted. As such, a non-symptomatic person may also be carrying the virus. Common symptoms include combination of: fever, cough and shortness of breath/breathing difficulties.

Most persons infected with Coronavirus experience only mild symptoms and recover. However, in more severe cases, infection can cause pneumonia, severe acute respiratory syndrome, kidney failure and even death.

Prevention: As a matter of general day to day precautions, measures should be taken, included: use of face masks on mouth and nose; Use of alcohol-based hand sanitizers; avoiding close contact with any person showing symptoms of Coronavirus; covering mouth and nose with hand or elbow while sneezing or coughing; washing of hands with soap for at least 20 seconds; and ensuring that meat is thoroughly cooked.

It is recommended to try and avoid close personal contact with people with a recent travel history from the countries, included: China, South Korea, Italy, Japan and Iran.

Testing: The ministry of national health services, Islamabad has procured testing kits for Coronavirus and provided the same to various laboratories across Pakistan. Following places are recommended for testing of Coronavirus:

National Institute of Health, Islamabad (free of cost)

Shaukat Khanum Labs (Across Pakistan)

Agha Khan Labs (Across Pakistan)

Dow University of Health Sciences, Karachi.

General instructions to Heads of field formations:

Foregoing in view, heads of all field formations are requested to ensure:

Display of precautionary measures including the causes, symptoms and prevention for Coronavirus at conspicuous places;

Placement of alcohol-bases hand sanitizers at all places of public interaction, both for FBR employees and general public;

Wearing of facemasks at all places of public interaction;

Use of disinfectants to wipe surfaces (Desks, tables and counters etc.) and objects (telephones and keyboards etc.) of common use on daily basis.

Reference to travel advisory before proceeding abroad on official work;

Politely discourage personal greetings in form of hugs and handshakes

Discontinuation of biometric attendance till culmination of Coronavirus threat.

February 27, 2020
IR offices to observe extended working hours on Feb 28 for revenue collection

KARACHI: The offices of Inland Revenue will observe extended working hours on Friday, February 28, 2020 to facilitate taxpayers in payment of due taxes and filing of tax returns.

The Federal Board of Revenue (FBR) in an office orders issued to Large Taxpayers Units (LTUs) Corporate Regional Tax Offices (CRTOs) and RTOs, directed to observe extended working hours till 10:00PM on Friday February 28, 2020 to facilitate the taxpayers in payment of duties and taxes and filing of Income Tax Returns / Statements.

The chief commissioners have been directed to establish liaison with State Bank of Pakistan (SBP) and authorized branches of National Bank of Pakistan (NBP) to ensure transfer of tax collection by these branches on February 28, 2020 to the respective branches of SBP on the same date so as to account for the same towards the collection for the month of February 2020.

The SBP also issued instructions that NBP branches as well as field offices of the SBP Banking Services Corporation, shall observe extended banking hours up to 8:00PM on February 28, 2020.

The NBP branches will settle their transactions on same day i.e. February 28, 2020 with respective SBP BSC offices for which purpose a special clearing will be arranged at 5:00PM by the NIFT on February 28, 2020.

The NBP shall settle their transactions with SBP BSC field offices/head office latest by 10:00PM on February 28, 2020.

The SBP further said that in order to eliminate the issue of spillover receipts, NBP shall ensure that no instrument containing receipts of the government, shall unattended at any NBP branch and shall be settled in the value date of February 28, 2020 through special clearing.

February 27, 2020
FBR allows sales tax return filing up to February 28

ISLAMABAD: Federal Board of Revenue (FBR) has allowed taxpayers to file their monthly sales tax and federal excise returns up to February 28, 2020.

The FBR on Thursday issued a notification for extension in date of submission of sales tax and federal excise return for the tax period of January 2020.

The notification said that the FBR further extended the date of submission of sales tax and federal excise return up to February 28, 2020 for the tax period of January 2020, which was due on February 18 and was extended up to February 26, 2020.

February 27, 2020
FBR invites sales tax proposals to eliminate flying invoices, tax fraud

The Federal Board of Revenue (FBR) has issued an invitation to business chambers and associations to submit their sales tax and federal excise proposals for the upcoming budget 2020/2021. The primary aim is to eliminate flying invoices and tax fraud while broadening the tax base and increasing revenue.
(more…)

February 27, 2020
FBR asks people to file income tax returns

ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday urged people having taxable income to file their income tax returns on or before February 28, 2020.

The FBR said persons having annual income of Rs400,000 must submit their annual tax returns for tax year 2019.

The tax body urged people to file annual income tax returns and play part to broaden tax net and become active taxpayer.

It further said that salaried persons can also file their income tax returns through Tax Asaan application through mobile phones.

Tax payment options have been provided through ATM, internet banking, credit card and direct debit from bank account.

February 26, 2020
Exporters doubt refund payment release on FBR collection failure

KARACHI: Exporters expressed concerns that their liquidity may be taken away by the government in shape of sales tax worth billions of rupees as Federal Board of Revenue (FBR) has failed to achieve its revenue collection target.

Mian Anjum Nisar, President, Federation of Pakistan Chambers of Commerce and Industry (FPCCI) said that the exporters fear that their precious liquidity taken away by the government in shape of sales tax worth billions of rupees which is completely stuck up and refunds may be excessively delayed because the FBR has also failed to achieve its revenue collection target.

FPCCI chief held a comprehensive detailed meeting with the leading export oriented sector at PHMA House, Karachi with Muhammad Jawed Bilwani, Chairman, Pakistan Apparel Forum and urged the Government to honour its commitment with the export sector.

The President, FPCCI said that the exporters are in real fixed and under stress as Government is not implementing the decision it has taken to support export oriented sector.

The Advisor to Prime Minister on Finance promised that the refunds will not get stuck up whereby he and his team have made a commitment that after passing of budget, his team will hold meetings with exporters and devise an automated system like in Bangladesh or China.

Through the automated system, exporters will get a major amount from bank or the State Bank and would not be dependent on the FBR. Advisor Finance promised that if the new refund system will not work, the govt. will revisit its decision in 3-6 month period. Since more than 8 months have been passed and the FBR FASTER system has failed for speedy refunds, therefore, the Govt. should honour their commitment and restore zero rating – No Payment No Refund Regime for the export sectors.

President FPCCI further told that the Govt. has failed to refund sales tax claims under FASTER System of textile exporters as per commitment, to refund claim amount in 72 hours, contrarily the Govt. has not paid exporters’ claims for the last seven months.

Approx. Rs100 billion of textile exporters liquidity held up under FASTER Refund System in last 8 months and total Rs210 billion are withheld with the government.

Payment timeline for payment of Customs Rebate claims which previously reduced to 7 months has again been prolonged to 13 months.

However, Government also committed that Customs Rebate, DLTL claims will also be paid electronically along with export proceeds.

Reportedly, hundreds of exporters SMEs have stopped their production owing to liquidity problems who have not received their sales tax refund claims for last seven months and due to high rates of utilities shall be compelled for closure if their sales tax refunds are not released on immediate basis and utility tariffs are not rationalized to facilitate them to get new orders and resume production.

The President FPCCI emphasized to implement power tariff of 7.5 cents/kwh including all charges across Pakistan including Karachi and RLNG at 6.5 dollars/MMBTU.

President also mentioned that while notification of said tariffs was issued the time period inadvertently was missing, it should be for three years period as agreed.

He further informed that the OGRA has separated zero rated industry from general industry for Gas Tariff while NEPRA is still not implementing the decisions of separate treatment for zero rated and general industry.

Mian Anjum Nisar President FPCCI said that the tariff for electricity and gas should be fixed on yearly basis for the Export Oriented Sectors and Priority be given only to these sector as the Export Sectors have to make commitments to their buyers for 6 months in advance and frequent increase in the electricity and gas tariffs jeopardizes their entire planning and they suffer huge losses to keep up commitments to their foreign buyers.

February 26, 2020
Taxpayers unable to file annual returns as FBR’s website goes offline

KARACHI: Taxpayers are not able to file their annual income tax returns for tax year 2019 as official portal of Federal Board of Revenue (FBR) is remained offline for past several hours on Wednesday.

The taxpayers, who failed to avail past timelines for filing their income tax returns for tax year, were trying to open the FBR’s online e-filing portal since morning but they were unable to access the portal to discharge their liability.

The FBR’s website was remaining offline till 4:50pm. FBR officials said that the website was offline for the past five to six hours.

It is worth mentioning that the last date for filing income tax returns is February 28, 2020.

The actual date for filing income tax for tax year 2019 was September 30, 2019 for salaried, business and Association of Persons (AOPs). For the companies the last date was December 31, 2019. However, the FBR extended the date for all taxpayers up to February 28, 2020.

Sources in the FBR said that the tax machinery was trying to bring the website online as soon as possible. However, they were unable to explain the error.

With the stoppage of the portal all the official work done online was also affected. Sources in local tax offices said that everything related to the portal was not responding.

The sources said that the FBR may not extend the last date for filing income tax returns despite non-operation of the official portal of the FBR.

February 26, 2020
FBR official website not responding

KARACHI: The official website of Federal Board of Revenue (FBR) is not available online for the past few hours creating problems for income tax return filers as the date is expiring after two days.

The official website https://www.fbr.gov.pk/ is not available online for the past few hours as the site showing massages of runtime error or connection timed out. The website was remained offline till 2:00pm on Wednesday.

It is important to note that the last date for filing income tax returns is February 28, 2020 for tax year 2020.

The actual last date for filing of income tax returns was September 30, 2019. However, the FBR allowed multiple extension in dates and latest extension was granted up to February 28, 2020.

Sources in the FBR, however, said that the problem was being resolved in order to provide facilitation to taxpayers.

February 26, 2020