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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.

  • FBR promotes Customs officers to BS-18

    FBR promotes Customs officers to BS-18

    Islamabad: Federal Board of Revenue (FBR) on Friday notified promotion of officers of Pakistan Customs Service (PCS) from BS-17 to BS-18.

    The following BS-17 officers of Pakistan Customs Service are promoted to BS-18 on regular basis with immediate effect:-

    1. Nawabzada Kamran Khan Jogezai

    2. Ubaidullah

    3. Farhat H. Khan

    4. Ali Mohtashim Minhas

    5. Muhammad Hamza Lak

    6. Abeer Javaid

    7. Sadaf Noor Elahi

    8. Quratulain Ramay

    9. Umair Zahid

    10. Syeda Sadaf Ali Shah

    11 . Shah Samad Hamadani

    12. Akmal Shahzad

    13. Saleem Tahir

    14. Ameer Ahmad

    The FBR said that the officers may actualize their promotions at their present place of posting.

    The officers, who are drawing performance allowance, will continue to draw the same after promotion.

    Through another notification the FBR said that officers Pakistan Customs Service from BS-17 to BS-18 were considered for promotion by the Departmental Promotion Committee on December 31, 2020.

    The committee recommended the following officers for promotion subject to completion of satisfactory missing Performance Evaluation Reports (PERs) mentioned against each without adverse remarks.-

    Malik Muhammad Ahmed 01.07.2019 to 15.02.2020

    All Asad  01.10.2019 to 30.06.2020

    Shakeel Ahmed 01.07.2019 to 30.06.2020

    Mustafa Zamir 01.07.2018 to 02.02.2019

    Ms. Asma Javed Paracha 01.07.2019 to 30.06.2020 2.

    The promotion of above named officers shall be notified on meeting the said condition, the FBR added.

  • FBR invites customs proposals for budget 2021/2022

    FBR invites customs proposals for budget 2021/2022

    The Federal Board of Revenue (FBR) has opened the floor for customs duty proposals as part of the preparations for the federal budget for the fiscal year 2021/2022.

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  • Budget 2021/2022 to focus on easing tax burden: Member IR

    Budget 2021/2022 to focus on easing tax burden: Member IR

    Karachi: The upcoming federal budget will ease the burden on the industrial sector to reduce the cost of doing business to facilitate industrial and exporters, Dr. Muhammad Ashfaq, Member Inland Revenue (Operations), Federal Board of Revenue (FBR), said on Friday.

    The Member was addressing the members of Karachi Chamber of Commerce and Industry (KCCI) during his four day visit to the city.

    The Member said that the FBR was working on a policy to reduce the cost of doing business.

    He said that it was encouraging that export orders were increasing. Further, a report of the State Bank of Pakistan (SBP) pointed out a reduction in the cost of doing business.

    “The budget 2021/2022 will focus on reducing the cost of production. Further, the priority will be easing the tax burden on the industrial sector,” the Member added.

    FBR receives numerous budget suggestions every year, he said, adding that the KCCI should send essential proposals.

    The Member said that the condition of CNIC was part of the statute. He also said that audit was part of the taxation system.

    He said that the FBR would introduce a new tax policy in the next three months. The Member said that refunds would be paid when claimed.

  • Sales tax registration may be suspended on non-filing of returns for six consecutive months

    Sales tax registration may be suspended on non-filing of returns for six consecutive months

    ISLAMABAD: Federal Board of Revenue (FBR) may suspend sales tax registration of a taxpayer who fails to file returns for six consecutive months, officials said on Thursday.

    The officials said that a commissioner of Inland Revenue may suspend registration of a taxpayer, if the person is found to have issued fake invoices, evaded tax or committed tax fraud without prior notice, pending further inquiry.

    Suspension of registration can occur due to the following possibilities:

    Non-availability of the registered person at the given address;

    Refusal to allow access to business premises or refusal to furnish records to an authorized Inland Revenue Officer;

    Abnormal tax profile, such as taking excessive input tax adjustments, continuous carry-forwards, or sudden increase in turnover;

    Making substantial purchases from or making supplies to other blacklisted or suspended person;

    Non-filing of sales tax returns by a registered person for six consecutive months;

    On recommendation of a commissioner of any other jurisdiction;

    Any other reason to be specified by the Commissioner;

    Impact of Suspension

    Commissioner shall issue written order to the concerned registered person detailing the reasons for suspension. The order shall also be provided to all other Large Taxpayer Units (LTUs)/Regional Tax Offices (RTOs), the FBR‘s computer system, the STARR computer system and the Customs Wing computer system for information and necessary action as per law;

    Suspension of registered person will make them ineligible to avail input tax adjustment/refund. Similarly, no input tax adjustment/refund shall be allowed to any other registered persons on the basis of invoices issued by such suspended person (whether issued prior to or after such suspension);

    The suspended registered person will be issued a show cause notice (through registered post or courier service) within seven days of issuance of order of suspension by the Commissioner. The registered person will have an opportunity of hearing with fifteen days of the issuance of such notice clearly indicating that the will be blacklisted. In case of non-availability of the suspended person at the given address, the notice may be placed on the main notice Board of the LTO/RTO;

    Where the show cause notice is not issued within seven days of the order of suspension, the order of suspension shall become invalid;

    To become part of the Active Taxpayer List (ST), the Active Taxpayer must be a registered person who does not fall in the following categories:

    Blacklisted or whose registration is suspended or blocked;

    Failed to file return by the due date for two consecutive tax periods;

    Failed to file Income Tax Return by the due date;

    Failed to file two consecutive monthly or annual withholding tax statement.

    A non-active taxpayer may be restored to active taxpayer status:

    If the respective RTO/LTO recommends the same to FBR after conducting audit or other investigation; Competent Authority, Appellate Authority, Court or FTO orders for the restoration.

  • Member IR (Operations) holds meetings with tax officials, industry to boost revenue collection

    Member IR (Operations) holds meetings with tax officials, industry to boost revenue collection

    KARACHI: Dr. Muhammad Ashfaq, Member Inland Revenue (Operations) of the Federal Board of Revenue (FBR) has launched a round of meetings with tax officials and industrialists during his four–day visit to Karachi starting from January 14, 2021.

    FBR sources on Thursday said that the Member IR had a busy schedule, which included meeting with the tax offices and chambers/associations.

    The sources said that the meetings would focus on revenue collection during the first half of the current fiscal year.

    During his meeting with chambers and associations, the member would encourage the industrials to contribute towards revenue collection.

    According to the schedule, the member will kick off the visit to meet with an industrialist on Thursday evening.

    The member on Friday will meet with office bearers of Karachi Chamber of Commerce and Industry (KCCI) and Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA). On the same day, the Member will meet the senior officials of the Medium Tax Office (MTO) and Corporate Tax Office (CTO) to review the revenue collection performance.

    On Saturday, the member will hold meetings with representatives of the Pakistan Yarn Merchant Association (PYMA) and Karachi Tax Bar Association (KTBA). On the same day, the Member will also hold a meeting with office-bearers of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI).

    On Sunday, the Member is scheduled to meet Chief Commissioners Inland Revenue to discuss the revenue performance.

  • FBR invites income tax proposals for budget 2021/2022

    FBR invites income tax proposals for budget 2021/2022

    ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday invited income tax proposals for budget 2021/2022 and asked stakeholders to submit the same by February 15, 2021.

    The FBR asked the tax offices, including Large Taxpayers Offices (LTOs), Medium Tax Offices (MTOs), Corporate Tax Offices (CTOs) and Regional Tax Offices (RTOs), and trade and industries that the proposals should focus on broadening the tax base for a wide participation in revenue generation efforts.

    The FBR advised that suggestions should in the following policy areas:

    Broadening of tax base for a wider participation in revenue generation efforts;

    Taxation of real income on progressive basis;

    Phasing out of tax concessions and exemptions;

    Removal of tax distortions and anomalies;

    Facilitation of taxpayers and ease of doing business;

    Promoting equity in taxation by introducing measures where incidence of tax is higher on affluent classes.

    The stakeholders have been asked to provide proposals in a prescribed formation that should include relevant sections/clauses or rules where amendment is sought. The proposals related to any section of Income Tax Ordinance, 2001 or any rule to Income Tax Rules, 2002 should be presented along with rationale and revenue impact.

  • FBR attributes export growth to incentives, facilitation

    FBR attributes export growth to incentives, facilitation

    ISLAMABAD:  Federal Board of Revenue (FBR) on Wednesday said that the significant growth in export was mainly due to integrated strategy for duty and tax incentives and other facilitation.

    The FBR has devised an Integrated Strategy which has amply contributed to significant increase in exports of Pakistan from $1.6 billion (in August, 2020) to $2.4 billion (in December, 2020).

    Growth in exports of Pakistan in December, 2020 is up by 18.3 per cent as compared to $1.993 billion in the corresponding month last year.

    While mentioning factors that have facilitated growth in exports, FBR has stated that Import duties on 1,623 tariff lines, pertaining to basic raw material and intermediate goods were reduced to zero through the Finance Act, 2020.

    In pursuance of this strategy, additional customs duties and regulatory duties on 164 items related to textile sector, not manufactured in the country, were also removed in collaboration with all the stakeholders.

    All these measures were undertaken with the objectives of neutralizing adverse impact of COVID 19 Pandemic, especially for the exporters, and to make their products competitive vis-à-vis those of their competitors in the international market.

    Under the initiative of “Make in Pakistan”, the Duty Drawback rates for at least eight (08) sectors were revised upwards by FBR. During the whole exercise, more than 434,000 claims were disposed of and approximately 7800 exporters have benefited from this Initiative.

    Similarly, FBR has paid ninety (90) percent more refunds of Sales Tax during July-December, 2020 as compared to the corresponding period last year.

    This led to significant rise in volumes of exports in the form of increase in TEUs (i.e. Tonnage Equivalent Units) / Containers from 35,477 in July, 2020 to 62,591 in December, 2020, showing a growth of 43 percent.

    In order to tangibly contribute to exports, all the Export Facilitation Schemes were simplified / rationalized for their optimal use by the exporters.

    First of all, extension in utilization period of different export facilitation schemes was allowed for a period of one year from 01st March, 2020 to 28th February, 2021.

    Secondly, retention period for plant and machinery, under the Export Oriented Units Scheme, was reduced from 10 years to five years.

    Thirdly, for the prompt redressal of grievances, one administrative tier is reduced (under Duty and Taxes Remission for Export Scheme and Manufacturing Bond Scheme) and Regulatory Authority is created to facilitate the exporters.

    Moreover, the investors in Export Processing Zones have been facilitated in payment of duties/taxes on the disposal of machinery in the tariff area.

    These facilitation measures have led to increase in number of exports Goods Declarations (GDs) from 71,190 in July, 2020 to 79,756 in December, 2020, posting an increase of 11 percent.

    In the same vein, total number of Exports Goods Declarations (GDs) (from 1st July, 2020 to 31st December, 2020), remained at 408,472 vis-à-vis 333,943 during 1st January, 2020, showing an increase of 18 percent.  

    To realize the objective of facilitation / promotion of exports, an automated system of filing the claim to the final sanctioning of Duty Drawback Claims for the payment of Duty Drawback Claims to the exporter was rolled out on 1st October, 2020. As a matter of fact, export Goods Declaration filed in Customs WeBOC system is being considered as the Duty Drawback Claim. State Bank of Pakistan credits the system sanctioned payments in the accounts of exporters online directly.

    In addition to the said automation initiative, Green Channel clearances of the exports GDs / Consignments were increased from 74 percent in July, 2020 to 77.3 percent in December, 2020.

    Similarly, for speedy payment of Sales Tax refunds to exporters, FASTER PLUS System has been implemented.

    FBR has also removed regulatory duty on import of cotton yarn, till 30th June, 2021, which is a basic raw material for the value-added textile industry of Pakistan.

    Being committed to the national goal of increase in exports, Federal Board of Revenue is making all out efforts to assist exporters by continuously making improvements in its laws and procedures.

  • FBR issues AML/CFT guidelines for accountants to comply with FATF conditions

    FBR issues AML/CFT guidelines for accountants to comply with FATF conditions

    KARACHI: Federal Board of Revenue (FBR) has issued guidelines for accountants related to Anti-Money Laundering (AML)/Counter Financing of Terrorism (CFT) laws to comply with conditions of Financial Action Task Force (FATF).

    The guidelines have been prepared jointly by Pakistan’s three designated AML/CFT supervisors of accountants in Pakistan, namely The Institute of Chartered Accountants of Pakistan (ICAP), the Institute of Cost and Management Accountant of Pakistan (ICMAP) and the FBR.

    Accountants are only subject to AML / CFT measures if they provide the specified activities or services as defined in the Anti Money Laundering Act (AMLA) Sections 2 (xii) (c) (d).

    All accountants, therefore, should review Section 4 in the Guidelines to determine whether they provide the specified services, and if so, what are the AML / CFT requirements, and how to implement the requirements.

    These are further explained in Sections 5 to 12 of the Guidelines.

    The Guidelines are focused on AML / CFT measures such as risk assessment, AML / CFT programme, CDD, beneficial ownership, politically exposed persons, targeted financial sanctions, Suspicious Transaction Report (STR), Currency Transaction Report (CTR) and record keeping. Those measures are further explained in the Guidelines.

    The guidelines do not add new regulatory requirements upon accountants.

    The guidelines do not address the broader criminal conduct associated with those who engaged in, or aid or abet those engaged in money laundering (ML) or terrorism financing (TF). Those criminal offences under the AMLA and other laws apply to all persons’ subject to Pakistan’s laws.

    In addition to the AMLA, the three main regulations referred to in the Guidelines are:

    The Anti-Money Laundering and Combating Financing of Terrorism Regulations for Cost and Management Accountants Reporting Firms (SRB AML / CFT Regulations for Reporting Firms)

    The Anti-Money Laundering and Combating Financing of Terrorism Regulations for Chartered Accountants Reporting Firms (SRB AML / CFT Regulations for Reporting Firms)

    The Federal Board of Revenue Anti-Money Laundering and Combating Financing of Terrorism Regulations for Designated Non-Financial Businesses and Professions (FBR AML / CFT Regulations for DNFBPs)

    AML / CFT Sanction Rules 2020 SRO NO 950(I)/2020 (AML / CFT Sanction Rules)

    Both the ICAP and ICMAP, as Self-Regulatory Bodies (SRBs), have been designated by Federal Government pursuant to AMLA (Section 6A) as AML / CFT regulatory authorities.

    To avoid repetition and any perceived favouritism, and purely for the purposes of the Guidelines, the two professional bodies will be referred to as “SRBs” and their AML / CFT regulations collectively referred to as the “SRB AML / CFT Regulations for Reporting Firms”. Except for the name of the SRB, the two regulations are identical.

    The FBR AML / CFT Regulations for DNFBPs are very similar to the SRB AML / CFT Regulations for Reporting Firms. However, they are not identical in terms of numbering and there are sector specific requirements covering other DNFBPs that are not applicable to accountants (accountants licensed by ICAP and ICMAP). For these reasons, they are referred separately in the Guidelines.

    The FATF Recommendations of specific concerns to accountants are those covering DNFBPs. DNFBPs include the following:

     Casinos

     Real estate agents

     Dealers in precious metals and stones

     Trust and company service providers

     Lawyers, notaries, other independent legal professionals and accountants – when they prepare for or carry out transactions for their customer concerning the following activities:

    — buying and selling of real estate;

    — managing of customer money, securities or other assets;

    — management of bank, savings or securities accounts;

    — organization of contributions for the creation, operation or management of companies;

    — creation, operation or management of legal persons or arrangements, and buying and selling of business entities.

    FBR explains accountant as sole practitioners, partners or employed professionals within professional firms when they prepare for or carry out transactions for their client concerning the following activities:

    Accountancy services – when carryout monetary transactions for their customers concerning the following activities:

    (I) managing, operating, buying and selling of real estate, legal persons and legal arrangements and preparing documents therefore;

    (II) managing of client money, securities or other assets;

    (III) managing bank, savings or securities accounts; or

    (IV) organizing contributions for the creation, operation or management of companies

    Trust and company formation services – when they carry out monetary transactions or services for a client concerning the following activities:

    (I) acting as a formation agent of legal persons;

    (II) acting as or arranging for another person to act as a director or secretary of a company, a partner of a partnership, or a similar position in relation to other legal persons;

    (III) providing a registered office, business address or accommodation, correspondence or administrative address for a company, a partnership or any other legal person or arrangement;

    (IV) acting as or arranging for another person to act as a trustee of a trust or performing the equivalent function for another form of legal arrangement; or

    (V) acting as or arranging for another person to act as a nominee shareholder for another person.

  • Defaulting sales tax payment may liable to three-year jail

    Defaulting sales tax payment may liable to three-year jail

    ISLAMABAD: A person fails to pay sales tax within due date or to comply with recovery order is liable to certain fine and penalty under Sales Tax Act, 1990, officials in Federal Board of Revenue (FBR) said on Tuesday.

    Any person who fails to deposit the amount of tax due or any part thereof in the time or manner laid down under Sections 3, 6, 7 and 48 of this Act or rules or orders made there under:

    “Such person shall pay a penalty of ten thousand rupees or five per cent of the amount of the tax involved, whichever is higher:

    “Provided that, if the amount of tax or any part thereof is paid within ten days from the due date, the defaulter shall pay a penalty of five hundred rupees for each day of default:

    “Provided further that no penalty shall be imposed when any miscalculation is made for the first time during a year:

    “Provided further that if the amount of tax due is not paid even after the expiry of a period of sixty days of issuance of the notice for such payments by an officer of Inland Revenue, not below the rank of Assistant Commissioner Inland Revenue, the defaulter shall, further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to three years, or with fine which may extend to amount equal to the amount of tax involved, or with both. “

  • Rules notified for taxpayers profile update

    Rules notified for taxpayers profile update

    ISLAMABAD: Federal Board of Revenue (FBR) on Monday notified rules for making it mandatory for taxpayers to update their profiles through IRIS portal.

    The FBR issued SRO 13(I)/2021 dated January 08, 2021 to amend Income Tax Rules, 2002. Through the SRO the FBR notified online format for taxpayers to update profile.

    Previously, the FBR issued SRO 1341(I)/2020 on December 16, 2020 for notifying draft rules related to taxpayers profile update.

    A new rule 34B has been proposed for taxpayer’s profile. The FBR said that this rule shall apply for the purpose of section 114A of the Income Tax Ordinance, 2001, which provides for the furnishing of a taxpayer’s profile.

    A taxpayer’s profile shall be filed electronically on the prescribed format and manner as provided on IRIS web portal.

    The taxpayer’s profile shall be verified in the manner specified on IRIS web portal.

    Through Finance Act, 2020 a new section 114A was inserted to Income Tax Ordinance, 2001 for making it mandatory for taxpayers to update their profile.

    Following is the text of Section 114A:

    Section 114A: Taxpayer’s profile.

    (1) Subject to this Ordinance, the following persons shall furnish a profile, namely:-

    (a) every person applying for registration under section 181;

    (b) every person deriving income chargeable to tax under the head, “Income from business”;

    (c) every person whose income is subject to final taxation;

    (d) any non-profit organization as defined in clause (36) of section 2;

    (e) any trust or welfare institution; or

    (f) any other person prescribed by the Board.

    (2) A taxpayer’s profile-

    (a) shall be in the prescribed form and shall be accompanied by such annexures, statements or documents as may be prescribed;

    (b) shall fully state, in the specified form and manner, the relevant particulars of –

    (i) bank accounts;

    (ii) utility connections;

    (iii) business premises including all manufacturing, storage or retail outlets operated or leased by the taxpayer;

    (iv) types of businesses; and

    (v) such other information as may be prescribed;

    (c) shall be signed by the person being an individual, or the person’s representative where section 172 applies; and

    (d) shall be filed electronically on the web prescribed by the Board.

    (3) A taxpayer’s profile shall be furnished,-

    (a) on or before the 31st day of December, 2020 in case of a person registered under section 181 before the 30th day of September, 2020; and

    (b) within ninety days registration in case of a person not registered under section 181 before the 30th day of September, 2020.

    (4) A taxpayer’s profile shall be updated within ninety days of change in any of the relevant particulars of information as mentioned in clause (b) of sub-section (2).

    The FBR on December 30, 2020 extended the last date for updating taxpayers profile up to March 31, 2021.