Pkrevenue.com

Tag: Federal Board of Revenue

The Federal Board of Revenue is Pakistan’s apex tax agency, overseeing tax collection and policies. Pakistan Revenue is committed to providing timely updates on the Federal Board of Revenue to its readers.

  • Customs clearance procedure for derelict consignments

    Customs clearance procedure for derelict consignments

    Section 23 of Customs Act, 1969 explains customs clearance procedure for derelict and wreck consignments.

    The Federal Board of Revenue (FBR) issued updated Customs Act, 1969 up to June 30, 2021. The act has been updated by making amendments brought through Finance Act, 2021.

    Following is the text of section 23 and 24 of the Customs Act, 1969:

    23. Goods, derelict, wreck, etc.- All goods, derelict, jetsam, flotsam and wreck, brought or coming into Pakistan, shall be dealt with as if they were imported into Pakistan.

    Section 24 describes duty free export of provisions and stores.

    24. Provisions and stores may be exported free of duty.- Goods produced or manufactured in Pakistan and required as provisions and stores on any conveyance proceeding to any foreign port, airport or station may be exported free of customs-duty, in such quantities as the appropriate officer may determine having regard to the size of the conveyance, the number of passengers and crew and the length of the voyage or journey on which the conveyance is about to depart.

    (Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)

    READ MORE: Re-importation of goods manufactured in Pakistan

  • FBR announces panel of advocates for Karachi tax cases

    FBR announces panel of advocates for Karachi tax cases

    KARACHI: The Federal Board of Revenue (FBR) has announced a panel of advocates, who will contest cases in various courts and tribunals on behalf of the tax authorities based in Karachi.

    Following advocates have been placed on the panel of the FBR, relating to court matters of Inland Revenue Service (IRS) for a period of three years:

    READ MORE: FBR sacks Customs appraising officer for misconduct

    01. Barrister Dr. Huma Sodher

    02. Abdul Latif Mirbahar

    03. Syed Ahasan Ali Shah

    04. Barrister Faheem Ali Memon

    05. Muhammad Azam Khan

    06. Ameer Nausherwan Adil

    READ MORE: Sindh integrates 56 restaurants for online tax monitoring

    07. Syeda Abdia Bukhari

    08. Muhammad Ali Shahwani

    09. Muhammad Ajmal Solangi

    10. Abdul Ghaffar

    11. Syed Mustafa Mehdi

    12. Barrister Imran Ahmed Metlo

    13. Sajjad Ahmed Chandio

    READ MORE: Salary tax rates in Pakistan for Tax Year 2022

    14. Rafeo Fazal

    15. Jazib Ali Shaikh

    16. Fareed Ahmed Dayo

    17. Mohsin Ali

    18. Muhammad Fahad

    19. Khalid Hidayat Khan

    20. Mutahir Khalid Khan

    21. Asad Aftab Solangi

    22. Sajjad Ali Solangi

    23. Zubair Zia Siddiqui

    24. Waheedullah Khokhar

    25. Saleem Ul Haq

    26. Barkat Ali Metlo

    27. Afsheen Aman

    28. Syed Shohrat Hussain Rizvi

    READ MORE: Re-importation of goods manufactured in Pakistan

    29. Khalil Ullah Jakhro

    30. Barrister Waqar Ali Baloch

    31. Shahid Hussain

    32. Ms. Tania Malik

    33. Barrister Ghazi Khan Khalil

    34. Barrister Zain Mustafa Soomro

    35. Muhammad Younus

    36. Ali Tahir Soomro

    37. Muhammad Saad Siddiqui

    38. Zulfiqar Ali Domki

    The FBR said advocates may be assigned court cases for pleading before various Courts / Tribunals at Karachi Station, on the basis of merit, keeping in view their experience and facts of the each case.

    Matter relating to professional fee/ special professional fee, appointment, performance evaluation, de-notification, conduct of the Panel Advocates and other related matters will be governed by the SOPs/ policy guidelines circulated vide FBR’s letter No. 176432 dated 12.10.2020, No. 129965-R dated 24.10.2017 and No. 9(2)PA/2020-21(Pt) dated 26.01.2021 and any other notification issued or to be issued from time to time.

  • FBR sacks Customs appraising officer for misconduct

    FBR sacks Customs appraising officer for misconduct

    KARACHI: Federal Board of Revenue (FBR) has sacked a Customs appraising officer (BS-16) on charges of misconduct and inefficiency.

    According to a notification issued on Tuesday, the FBR said disciplinary proceedings were initiated against Arjad Abbas Khosa, Appraising Officer (BS-16), Collectorate of Customs, Islamabad under the Civil Servants (Efficiency & Discipline) Rules, 2020 on account of acts of omission and commission constituting ‘Inefficiency’ and ‘Misconduct’.

    READ MORE: Customs chemical examiner awarded ‘removal from service’

    Ms. Kaukab Farooq, Additional Collector (BS-19), Collectorate of Customs, Islamabad was appointed as Inquiry Officer on January 06, 2022, who conducted inquiry under the Civil Servants (Efficiency & discipline) Rules, 2020 and submitted inquiry report to the Board on March 04, 2022 with the findings that the Allegation No. (i), (ii) and (iii) as mentioned in Order of Inquiry stand proved against the accused Appraising Officer.

    The Inquiry Officer has concluded that the charges of “inefficiency” and “Misconduct” against the accused officer stand established.

    READ MORE: President Alvi retains major penalty on NAB official

    On the basis of Inquiry Report, Show Cause Notice was served on March 18, 2022 upon Arjad Abbas Khosa, Appraising Officer (BS-16), Collectorate of Customs, Islamabad. The Collectorate served show cause notice to the accused by displaying on notice board, on his personal email address and through courier on his given residential addresses.

    The accused failed to submit his defence reply to the show cause notice nor made any request for personal hearing during the stipulated time period. As no defence reply to show cause notice has been submitted before the Member

    (Admn/HR)/Authority by the accused, the authority, by considering the available case record and inquiry report has observed that the accused has been absconding from duty w.e.f. April 16, 2021 without any intimation. Therefore, the charges leveled vide Order of Inquiry dated January 06, 2022 stand established.

    READ MORE: Customs officer awarded ‘major penalty’ for corruption

    Accordingly, the Member (Admn/ HR) / Authority has decided that the charges of “Inefficiency” and “misconduct” under Rule 3(a) and (b) of Civil Servants (E&D) Rules, 2020 stand established against the accused.

    The Authority has, therefore, imposed major penalty of “Dismissal from Service” upon Arjad Abbas Khosa, Appraising Officer (BS-16), Collectorate of Customs, Islamabad under Rule-4(3)(e) of the Civil Servants (E&D) Rules, 2020.

    The officer will have a right to file appeal against this Order to the Appellate Authority under Civil Servants (Appeals) Rules, 1977 within a period of 30 days from the date of communication of this notification.

    READ MORE: FBR terminates job of IRS officer on misconduct

  • Re-importation of goods manufactured in Pakistan

    Re-importation of goods manufactured in Pakistan

    Section 22 and 22A of Customs Act, 1969 explains re-importation of goods manufactured in Pakistan and temporary export of imported plant and machinery.

    The Federal Board of Revenue (FBR) issued updated Customs Act, 1969 up to June 30, 2021. The act has been updated by making amendments brought through Finance Act, 2021.

    Following is the text of section 22 and 22A of the Customs Act, 1969:

    22. Re-importation of goods produced or manufactured in Pakistan.- If goods produced or manufactured in and exported from Pakistan are subsequently imported into Pakistan, such goods shall be liable to customs-duties and be subject to all the conditions and restrictions, if any, to which goods of the like kind and value not so produced or manufactured are liable on the importation thereof:

    Provided if such goods have been imported within one year of their exportation and have been consigned to the person in whose account they were exported and have not undergone any processing since their exportation], the appropriate officer not below the rank of 28[Assistant Collector of Customs may admit the goods-

    (a) Where at the time of exportation of such goods, rebate, refund or drawback of any customs or Federal Excise duty or any other tax levied by the Federal Government or any tax, cess or duty levied by the Provincial Government was allowed on payment of customs duty equal to the amount of such rebate, refund or drawback as the case may be;

    (b) where such goods were exported in bond, without payment of –

    (i) the customs-duty chargeable on the imported materials, if any, used in the manufacture of the goods; or

    (ii ) the Federal Excise duty chargeable on the indigenous materials, if any, used in the manufacture of such goods; or

    (iii) the Federal Excise duty, if any, chargeable on such goods; or

    (iv) any other tax chargeable on the material used in the manufacture of such goods; or

    (v) any other tax chargeable on such goods,

    on payment of customs-duty equal to the aggregate amount of all such duties and taxes calculated at the rates prevailing at the time and place of importation of goods; or

    (c) in any other case, without payment of duty.

    22A. Temporary export of imported plant and machinery.- Imported plant and machinery, temporarily exported that have not undergone any alteration, renovation, addition or refurbishment, may be re-imported duty free subject to the specific or general terms and conditions the Board may by the rules prescribe.

    (Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)

  • Salary tax rates in Pakistan for Tax Year 2022

    Salary tax rates in Pakistan for Tax Year 2022

    ISLAMABAD: Pakistan tax authorities have issued tax rates for salary income during tax year 2022.

    In Pakistan a person earning Rs600,000 on annual basis as salary income is not required to pay tax. It means annual salary income up to Rs600,000 is exempt from tax.

    The First Schedule of Income Tax Ordinance, 2001 the tax rates for salary income has been defined for tax year 2022.

    Following are the rates of tax for salaried persons during tax year 2022 (July 01, 2021 – June 30, 2022):

    (2) Where the income of an individual chargeable under the head “salary” exceeds seventy-five per cent of his taxable income, the rates of tax to be applied shall be as set out in the following table, namely:—

    1. Where taxable income does not exceed: Rs. 600,000 0%

    2. Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,000: 5% of the amount exceeding Rs. 600,000

    3. Where taxable income exceeds Rs. 1,200,000 but does not exceed Rs. 1,800,000: Rs. 30,000 plus 10% of the amount exceeding Rs. 1,200,000

    4. Where taxable income exceeds Rs. 1,800,000 but does not exceed Rs. 2,500,000: Rs. 90,000 plus 15% of the amount exceeding Rs. 1,800,000

    5. Where taxable income exceeds Rs.2,500,000 but does not exceed Rs. 3,500,000: Rs. 195,000 plus 17.5% of the amount exceeding Rs. 2,500,000

    6. Where taxable income exceeds Rs. 3,500,000 but does not exceed Rs. 5,000,000: Rs. 370,000 plus 20% of the amount exceeding Rs. 3,500,000

    7. Where taxable income exceeds Rs. 5,000,000 but does not exceeds Rs. 8,000,000: Rs. 670,000 plus 22.5% of the amount exceeding Rs. 5,000,000

    8. Where taxable income exceeds Rs. 8,000,000 but does not exceeds Rs. 12,000,000: Rs. 1,345,000 plus 25% of the amount exceeding Rs. 8,000,000

    9. Where taxable income exceeds Rs. 12,000,000 but does not exceeds Rs. 30,000,000: Rs. 2,345,000 plus 27.5% of the amount exceeding Rs. 12,000,000

    10. Where taxable income exceeds Rs. 30,000,000 but does not exceeds Rs. 50,000,000: Rs. 7,295,000 plus 30% of the amount exceeding Rs. 30,000,000

    11. Where taxable income exceeds Rs. 50,000,000 but does not exceeds Rs. 75,000,000: Rs. 13,295,000 plus 32.5% of the amount exceeding Rs. 50,000,000

    12. Where taxable income exceeds Rs. 75,000,000 Rs. 21,420,000 plus 35% of the amount exceeding Rs. 75,000,000]

    (Disclaimer: The text of the above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)

  • Customs chemical examiner awarded ‘removal from service’

    Customs chemical examiner awarded ‘removal from service’

    ISLAMABAD: Federal Board of Revenue (FBR) has awarded major penalty of ‘removal from service’ upon a chemical examiner of Pakistan Customs Service (PCS) on the charges of misconduct and inefficiency.

    According to details received on Monday, disciplinary proceedings were initiated against Tahir Jamal, Deputy Assistant Chemical Examiner (BS-16), Collectorate of Customs Appraisement-West, Karachi under the Civil Servants (Efficiency & Discipline) Rules, 2020.

    READ MORE: President Alvi retains major penalty on NAB official

    Saad Atta Rabbani, Additional Collector (BS-19), Collectorate of Customs Appraisement (West), Karachi was appointed as Inquiry Officer vide Order of Inquiry dated August 04, 2021 who conducted inquiry under the Civil Servants (Efficiency & discipline) Rules, 2020 and submitted inquiry report to the FBR on January 05, 2022 with the findings and conclusion that the charges of “Inefficiency” and “Misconduct” stand fully established against the accused officer.

    On the basis of Inquiry Report, a Show Cause Notice was issued on March 31, 2022 to Tahir Jamal, Deputy Assistant Chemical Examiner (BS-16), Collectorate of Customs Appraisement (West), Karachi.

    READ MORE: Customs officer awarded ‘major penalty’ for corruption

    He submitted reply to the Show Cause Notice, which was received in the Board on April 15, 2022, wherein he stated that the Order of Inquiry dated August 04, 2021 is illegal and requires to be withdrawn.

    He further stated that he has challenged the Order of Inquiry by filing an appeal before the Federal Service Tribunal (FST). He also requested for personal hearing enabling him to explain his case in person as well.

    The Member (Admn/HR) / Authority afforded an opportunity of personal hearing to the accused on May 23, 2022.

    The Member (Admn/ HR) / Authority having carefully considered the record of the case, the Inquiry Report, reply to the Show Cause Notice and the submissions made by the accused during the personal hearing, has found no solid evidence and merits in the stance of the accused for submitting wrong/misleading laboratory test reports and remaining away from office w.e.f. August 07, 2018 till date.

    READ MORE: FBR terminates job of IRS officer on misconduct

    Accordingly, the Member (Admn/ HR) / Authority has observed that charges of “Inefficiency” and “misconduct” under Rule 3(a) and (b) of Civil Servants (E&D) Rules, 2020 stand established against the accused.

    The Authority has, therefore, imposed major penalty of “Removal from Service” upon Tahir Jamal, Deputy Assistant Chemical Examiner (BS-16), Collectorate of Customs Appraisement (West), Karachi under Rule 4(3)(d) of the Civil Servants (E&D) Rules, 2020.

    He will have a right to file appeal against this Order to the Appellate Authority under Civil Servants (Appeals) Rules, 1977 within a period of 30 days from the date of communication of this Notification.

    READ MORE: Customs officer awarded ‘dismissal from service’

  • RTO-II Karachi seals Baklava Palace for integration failure

    RTO-II Karachi seals Baklava Palace for integration failure

    KARACHI: Regional Tax Office (RTO) – II, Karachi on Monday sealed a sweet shop i.e. M/s. Baklava Palace for failure to mandatory integrate with online system.

    RTO – II, Karachi, an arm of the Federal Board of Revenue (FBR), while continuing its crackdown against non-compliant Tier-1 retailers, sealed the business premises of M/s. Baklava Palace, located at Khayaban-e-Shamsheer, DHA Phase V, Karachi.

    READ MORE: RTO-II Karachi seals electronics shop for integration failure

    The RTO –II Karachi during its drive against non-compliant Tier-1 Retailers had sealed many other retail outlets including Dhamtal and Rafi Electronics.

    According to officials at Zone-III, RTO-II, Karachi said that the tax office had already passed an order on January 01, 2022 against the Tier-1 retailer for mandatory integration.

    “M/s. Baklava Palace (NTN 2668310-5) is conducting taxable activities as a retailer and comes under the purview of Tier-1 retailer as defined under clause (a) and (e) of Section 2(43A) of the Sales Tax Act, 1990.

    READ MORE: FBR issues procedure for restoration of input tax adjustment

    “As per 2nd provisio of Section 3(9A) of the Sales Tax Act, 1990, read with clause (2) of Rule 150ZEA of the Sales tax Rules, 2006, they were required to integrate their Point of Sale (POS)/retail outlet with the FBR’s computerized system for real-time reporting of sales in the mode and manner prescribed in Chapter XIV-AA of the Sales Tax Rules, 2006.

    “The taxpayer is also included in STGO No. 16 of 2022 dated May 06, 2022. However, record shows that M/s. Baklava Palace has not integrated their POS / retail outlet till date,” the official told PkRevenue.com

    All the Tier-1 retailers are required to integrate with the FBR under Section 33 of the Sales Tax Act, 1990. The RTO-II had warned the Tier-1 retailer that in case it failed to integrate in the manner as required under the Sales Tax Act, 1990 and the rules made thereunder, the business premises will be sealed.

    READ MORE: POS service fee issue hampers sales tax return filing

    Under the Sales tax Act. 1990: it is an offence: “A person required to integrate his business as integrated under sub-section (9A) of Section 3, who fails to get himself registered under the Act, and if integrated, fails to integrate in the manner as required under the law and rules made thereunder.”

    The penalties for the offence are included as:

    (i) penalty of five hundred thousand rupees for first default;

    (ii) penalty of one million rupees for second default after fifteen days of order for first default;

    (iii) penalty of two million rupees for third default after fifteen days of order for second default;

    (iv) penalty of three million rupees for fourth default after fifteen days of order for third default:

    READ MORE: FBR issues list of 185 retailers for mandatory integration

    Notwithstanding above, the business premises of such person shall be liable to be sealed by an officer of Inland Revenue in the manner prescribed.

    Provided that if the retailer integrates his business with the Board’s Computerized System before imposition of penalty for second default, penalty for first default shall be waived by the Commissioner.

  • FBR may defer duty collection through special order

    FBR may defer duty collection through special order

    Section 21A of Customs Act, 1969 has empowered Federal Board of Revenue (FBR) to defer imposition of custom duty through especial order.

    READ MORE: Govt. may exempt customs duty in emergency situation

    The Federal Board of Revenue (FBR) issued updated Customs Act, 1969 up to June 30, 2021. The act has been updated by making amendments brought through Finance Act, 2021.

    Following is the text of section 21A of the Customs Act, 1969:

    READ MORE: FBR’s power to notify customs tariff

    21A. Power to defer collection of customs-duty.- (1) Subject to such conditions, limitations or restrictions as it thinks fit to impose, the Board may, in such general cases as may be prescribed by rules or in particular cases by special order, defer the collection of customs-duties either in whole or in part.

    (2) Where deferment of customs-duties is allowed by the Board under sub-section (1), a surcharge not exceeding KIBOR plus three per cent per annum shall also be payable on the deferred amount from such date and in the manner as the Board may by rules prescribe.

    READ MORE: Detention of goods violating customs act

    (Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)

    READ MORE: Rate of customs duty in Pakistan on imports

  • FBR issues list of 113 retailers for mandatory integration

    FBR issues list of 113 retailers for mandatory integration

    ISLAMABAD: The Federal Board of Revenue (FBR) has issued a list of 113 retailers and directed them to integrate by June 10, 2022 otherwise action will be taken as per law.

    The FBR issued Sales Tax General Order (STGO) No. 18 of 2022 related to Tier-1 retailers for integration with FBR’s Point of Sale (POS) system.

    READ MORE: FBR issues list of 185 retailers for mandatory integration

    The Finance Act, 2019 added sub-section (6) to Section 8B of the Sales Tax Act, 1990 whereby a Tier-1 Retailer 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 substituted by 60 per cent vide Finance Act, 2021.

    READ MORE: FBR issues list of 1,358 retailers for mandatory POS

    In order to operationalize this important provision of law, a system-based approach has been adopted whereby all Tier-1 Retailers who were liable to integrate but have not yet integrated, with effect from July 2021 (Sales Tax Returns filed in August 2021) are not be dealt as per the procedure laid down in STGO No/ 1 of 2022 issued on August 3, 2021.

    READ MORE: Prize scheme on invoices issued by retailers

    Under this STGO, a list of 113 identified Tier-1 Retailers has been placed on FBR’s web portal allowing them to integrate with FBR’s system by June 10, 2022 and the procedure of exclusion from this list of 113 identified Tier-1 Retailers shall apply as laid down in STGO 17 of 2022 dated May 05, 2022.

    The FBR said that upon filing sales tax return for the month of May 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.

    READ MORE: FBR decides penal action against defaulting retailers

  • Compliance cost much higher for corporatization: PSX

    Compliance cost much higher for corporatization: PSX

    KARACHI: Pakistan Stock Exchange (PSX) has said that tax rates for compliance by corporate entities is much higher than the persons out of the tax net.

    The PSX in its proposals for budget 2022/2023 submitted to Federal Board of Revenue (FBR), said corporate business profits are taxed twice. Once at company level at 29 per cent and on dividend distribution at 15 per cent.

    READ MORE: FBR suggested reduction in tax rates for equity funds

    As compare to 44 per cent of total tax in case of companies, unincorporated businesses are being taxed from 0 per cent to 35 per cent in slabs.

    This inequality in taxation is discouraging corporatization and documentation as unincorporated businesses are subject to substantially lower taxes.

    Absence of clarity in tax laws is causing issues of taxation of Limited Liability Partnership (LLPs) as companies whereas LLPs are essentially AoPs with perpetual life.

    Removal of exemption on inter-corporate dividend under section 59B of the Income Tax Ordinance, 2001 is unfavorable to potential corporate groups discouraging compliance with the best practices of corporate governance requirements.

    READ MORE: PSX proposes tax exemption on property transactions

    The PSX said that inequality of taxation of business shall gradually be removed by reducing corporate tax rate/increasing tax rates for AoPs [First Schedule Part 1, Division I, II, IIA & III].

    Restoration of exemption on inter-corporate dividend between companies eligible for group taxation under section 59B of the Income Tax Ordinance, 2001.

    Giving rationale to the proposal, the PSX said that equality of tax regime will promote corporatization culture leading towards documentation and will therefore generate more tax revenue.

    Adding clarity with respect to status of LLP will encourage more business particularly in services sector to opt for this perpetual business structure. It will also help in increasing tax revenue from these segments.

    READ MORE: SMEs should be given tax credit to encourage listing

    Definition of AoP in section 80(2) of Income Tax Ordinance, 2001 be amended to include LLP till the time same tax rates are not applied to all forms of business.

    Part I, Second Schedule, clause 103C reinstated as follows:

    “Dividend income derived by a company, if the recipient of the dividend, for the tax year is eligible for group relief under section 59B.”

    READ MORE: FBR urged to eliminate minimum tax for listed companies