The Federal Board of Revenue (FBR) has established the advance tax rates on returns from investment in sukuk for the tax year 2022.
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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.
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Advance tax rates on dividend for Tax Year 2022
The advance tax rates on dividends for the tax year 2022 are under the First Schedule of the Income Tax Ordinance, 2001.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
The rate of tax to be deducted under section 150 shall be-
(a) 7.5 per cent in case of dividend paid by Independent Power Producers where such dividend is a pass through item under an Implementation Agreement or Power Purchase Agreement or Energy Purchase Agreement and is required to be re-imbursed by Central Power Purchasing Agency (CPPA-G) or its predecessor or successor entity.
(b) 15 per cent in mutual funds, Real Estate Investment Trusts and cases other than those mentioned in clauses (a) and (ba); and
(ba) 25 per cent in case of a person receiving dividend from a company where no tax is payable by such company, due to exemption of income or carry forward of business losses under Part VIII Chapter III or claim of tax credits under Part X of Chapter III.
(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.)
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Rates of tax on imports for Tax Year 2022
The advance tax rates for the tax year 2022 are under the First Schedule of the Income Tax Ordinance, 2001.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
The rate of advance tax to be collected by the Collector of Customs under section 148 shall be-
- The tax rate on persons importing goods classified in Part I of the Twelfth Schedule shall be one per cent of the import value as increased by customs-duty, sales tax and federal excise duty.
- The tax rate on persons importing goods classified in Part II of the Twelfth Schedule shall be two per cent of the import value as increased by customs-duty, sales tax and federal excise duty.
- The tax rate on persons importing goods classified in Part III of the Twelfth Schedule shall be 5.5 per cent of the import value as increased by customs-duty, sales tax and federal excise duty;
Provided that the rate specified in column (3),—
(a) in the case of manufacturers covered under rescinded Notification No. S.R.O 1125(I)/2011 dated the 31st December, 2011 as it stood on the 28th June, 2019 on import of items covered under the aforementioned S.R.O shall be 1%;
(b) in case of persons importing finished pharmaceutical products that are not manufactured otherwise in Pakistan, as certified by the Drug Regulatory Authority of Pakistan shall be 4%:
(c) in case of importers of CKD kits of electric vehicles for small cars or SUVs with 50 kwh battery or below and LCVs with 150 kwh battery or below shall be one percent:] Provided further that the rate of tax on value of import of mobile phone by any person shall be as set out in the following table, namely:-
(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.)
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FBR suspends credit notes against unregistered supplies
The Federal Board of Revenue (FBR) has stirred controversy with its recent decision to suspend credit notes against supplies made to unregistered persons, a move that has drawn strong protests from the Karachi Tax Bar Association (KTBA).
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FBR vows to curb money laundering in real estate
ISLAMABAD: The Federal Board of Revenue (FBR) has vowed to continue its efforts to stop money laundering through real estate and precious metals and stones, including gold and jewellery.
FBR Chairman Dr. Muhammad Ashfaq Ahmed that FBR will continue implementing the AML/CFT regulations in order to curb the menace of money laundering through real estate and precious metals and stones, including gold and jewellery.
The chairman issued the statement on the major achievement of completing actions on Designated Non-Financial Businesses and Professions (DNFBS) in the FATF action plan I just one reporting cycle and one year ahead of the deadline in September 2022.
The Chairman FBR Dr. Muhammad Ashfaq Ahmed congratulated DG DNFBPs, Mr. Mohammad Iqbal, and his team for the tireless efforts to complete the actions on DNFBPs in a short span of three months and one year ahead of the deadlines.
The FATF plenary in its public statement has noted that Pakistan has now satisfied the requirements of most of its action items under the 2021 action plan, ahead of deadlines and in its first reporting cycle.
In June 2021, the FATF plenary had approved a seven actions new action plan for Pakistan, focusing on combating money laundering. This action plan contained two actions specific to DNFBPs, in particular, the real estate agents and Dealers in Precious Metals and Stones (DMPS). FBR was already designated as AML/CFT regulatory authority for real estate agents, DPMS and accountants other than those registered with ICAP and ICMAP under the Anti-Money Laundering Act, 2010, through amendments made in September 2020.
Since the designation of FBR as the AML/CFT regulatory authority, FBR issued AML/CFT regulations for its regulated entities and also embarked upon an extensive outreach to educate and facilitate the DNFBPs on implementation of the new AML/CFT regime. A dedicated portal was made available on FBR website, which contains comprehensive guidance documents and other information for the DNFBPs. FBR also launched a customized mobile App for the registration by DNFBPs, screening the lists of proscribed /designated persons and generating Suspicious Transaction Reports (SRTs). A detailed supervisory plan was chalked out for offsite and onsite supervision of the DNFBPs.
Since June 2021, FBR has carried out onsite inspections of a large number of DNFBPs and imposed a wide range of penalties on the delinquent entities. The real estate associations were also taken on board for the implementation of the AML/CFT obligations.
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Minimum tax rates for tax year 2022
The minimum tax rates for the tax year 2022 are under the First Schedule of the Income Tax Ordinance, 2001.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
Following are the minimum tax rates under Section 113 of Income Tax Ordinance, 2001:
01. The tax rate shall be 0.75 per cent on the following:
(a) Oil marketing companies, Sui Southern Gas Company Limited and Sui Northern Gas Pipelines Limited (for the cases where annual turnover exceeds rupees one billion.)
(b) Pakistani International Airlines Corporation; and
(c) Poultry industry including poultry breeding, broiler production, egg production and poultry feed production;
02. The tax rate shall be 0.5 per cent on the following:
(a) Oil refineries
(b) Motorcycle dealers registered under the Sales Tax Act, 1990
03. The tax rate shall be 0.25 per cent on the following:
(a) Distributors of pharmaceutical products, fast moving consumer goods and cigarettes;
(b) Petroleum agents and distributors who are registered under the Sales Tax Act, 1990;
(c) Rice mills and dealers;
(d) Tier-1 retailers of fast moving consumer goods who are integrated with Board or its computerized system for real time reporting of sales and receipts;
(e) Person’s turnover from supplies through e-commerce including from running an online marketplace as defined in clause (38B) of section 2.
(f) Persons engaged in the sale and purchase of used vehicles; and
(g) Flour mills
04. The tax rate shall be 1.25 per cent in all other cases
(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.)
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FBR warns of action for delaying inquiry reports
The Federal Board of Revenue (FBR) has issued a stern warning to inquiry officers, cautioning them of potential disciplinary action for prolonged delays in submitting inquiry reports.
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Valuation committees for Afghan, Iran goods to be set up
ISLAMABAD: The Federal Board of Revenue (FBR) will constitute local valuation committee for customs valuations of goods imported or exported from Afghanistan and Iran.
Through SRO 1352 (I)/2021 dated October 14, 2021, the FBR issued draft amendments for local valuation committee rules under Section 25A of the Customs Act, 1969.
The proposed amendments would be applicable for the determination of value of goods of Afghan and Iran origin in order to regulate the Pak-Afghan bilateral trade by discouraging the incidences of under invoicing and smuggling.
The FBR said that the proposed amendments would be applicable on the Afghan and Iran origin goods, imported from Afghanistan and Iran through land routes. In case, if an item is being imported through sea route in significant quantities from Iran, then, the value of such items shall be determined in consultation with Directorate of Valuation, Karachi.
According to the draft amendments, the respective collector of customs (appraisement), on his own motion, in his area of jurisdiction may determine the customs values of any goods or category of goods imported in or exported out of Pakistan from or to Afghanistan and Iran through land customs stations through the following valuation committee constituted for the said purpose, members whereof shall be nominated by collector concerned, namely:
(a) one additional collector of the collectorate (chairman of the committee);
(b) two deputy or assistant collectors of the collectorate (Members of the committee);
(c) superintendents of principal appraisers or appraisers or inspectors as required;
(d) representative of respective chamber of commerce and industry;
(e) representative of Customs’ clearing agents association;
(f) All Pakistan Dry Fruits Importer and Exporter Association;
(g) all Pakistan Fresh Fruits Importers and Exporters Association; and
(h) any other co-opted member as deemed appropriate by the collector.
The values so determined by the collector on recommendations of the committee shall be valid for six months.
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FBR to replace IRIS for tax payments: CCIR RTO
KARACHI: The Federal Board of Revenue (FBR) to introduce a new and efficient system for payment of all kind of tax payments, said a top tax official.
“We will introduce a new and efficient system replacing IRIS in which all kinds of taxes can be easily paid in one place,” a press statement quoted Tariq Mustafa Chief Commissioner Inland Revenue, Regional Tax office (RTO) Karachi as saying on Wednesday.
According to the statement issued by Korangi Association of Trade and Industry (KATI) the CCIR said that it was not the policy of FBR to impose more burden on the taxpayers.
The RTO Chief said that the issues raised by KATI would not only improve the regional tax office but also benefit the FBR. He said that after 2013, tax refund payments were in a halt. Under the current system, there is no problem of refunds.
Refunds are now paid immediately through the modern automated system, we are hold accountable for non-payment of refunds.
KATI members can contact me for any complaint regarding FBR. My doors are open to all members, he said.
KATI President Salman Aslam, KATI CEO Zubair Chhaya, Tax Liaison Committee Chairman Masood Naqi, Senior Vice President Maheen Salman, Former Presidents Saleem-uz-Zaman, Tariq Malik, Farhan-ur-Rehman, Rashid Siddiqui, Johar Qandhari, Ehteshamuddin, Syed Farukh Mazher and a large number of other members including were present.
Earlier, KATI President Salman Aslam welcomed the arrival of Chief Commissioner Inland Revenue Tariq Mustafa in KATI and said that the industrialists were concerned over the reports of freezing the accounts of defaulters. He said that to increase further revenues tax net needs to be widened, adding that harassment of taxpayers would not increase revenue.
President KATI said that new policies should be formulated to facilitate the tax system so that the industrialists consider paying taxes without any fear as a national duty.
KITE CEO Zubair Chhaya said that, we have been made withholding agent without any compensation and instead of encouragement, we have been issued monitoring notices from 2014 to date.
The government should encourage withholding agents. He said that in terms of filers and non-filers, non-filers save their lives by paying extra tax once while filers go through various notices and audits despite paying taxes.
A policy should be formulated in consultation with the stakeholders to widen the scope of taxation.
Facilities should be provided to the industrialists of Karachi so that the industries can be promoted and the national revenue can be further increased.
On the occasion, Chairman Tax Liaison Committee Masood Naqi said that a focal person should be appointed to facilitate the industrialists of Korangi and FBR who could provide immediate assistance to the members of KATI.
He said freezing accounts and imposing heavy fines would discourage taxpayers as they would not be able to pay heavy fines due to the post-COVID economic crisis.
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Tax rates on builders, developers for tax year 2022
Islamabad: The Federal Board of Revenue (FBR) has unveiled the tax rates applicable to builders and developers for the tax year 2022.
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