KARACHI: A registrar is required to provide information of buyers and sellers of immovable property in withholding tax statement to the Federal Board of Revenue (FBR).
(more…)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.
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FBR to get real-time data of financial transactions
ISLAMABAD: Federal Board of Revenue (FBR) will get real-time data of financial transactions of the banking system by end of this year.
According to the minutes of the meeting chaired by the prime minister last month, it is decided that Ministry of Law and Justice in consultation with State Bank of Pakistan (SBP) to propose necessary amendments in banking laws/ regulations for ensuring real-time data sharing of financial transactions with the Federal Board of Revenue (FBR).
The law division and SBP have been tasked to finalize the proposal by December 31, 2019.
The meeting considered the adoption of Computerized National Identity Card (CNIC) as common identifier.
The meeting discussed that data consolidation and documentation of economy is a key responsibility of all public and private sector organizations such as financial institutions, utility companies etc.
CNIC, as common identifier needs to be adopted by all public and private sector entities for documentation of economy and real time sharing of transactions data with the FBR.
In the same context commercial utility connections have still not been brought into the tax net with rampant tax evasion in vogue.
The meeting decided that CNIC would be adopted as common identifier by June 30, 2020 akin to social security number in western countries for all business transactions.
It is also decided that the Ministry of Law and Justice in consultation with SBP to propose necessary amendments in Banking Laws / Regulations for ensuring real-time data sharing of financial transactions with the FBR.
The meeting decided that by November 30, 2019 the commercial electricity and gas connections must be brought into the tax net immediately.
The FBR has been given task to bring all commercial electricity and gas connections into the tax net.
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FBR to initiate criminal proceedings in tax evasion above Rs10 million
Implementing full-fledged VAT regime in next two to four years decided
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FBR to initiate criminal proceedings in tax evasion above Rs10 million
ISLAMABAD: Federal Board of Revenue (FBR) will initiate criminal proceedings in those cases where tax evasion above Rs10 million is detected.
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Implementing full-fledged VAT regime in next two to four years decided
ISLAMABAD: The government has decided to implement full-fledged Value Added Tax (VAT) by eliminating General Sales Tax (GST) in next two to four years.
This has been decided at a meeting under the chairmanship of the prime minister held last month.
According to the minutes of the meeting, it was considered that VAT regime instead of GST needs to be gradually implemented within 2-4 years to enhance revenues, broaden tax base and assist in documentation of economy.
It is decided that the Federal Board of Revenue (FBR) will fully implement VAT regime for all business segments over next 2-4 years.
According to the roadmap for VAT implementation, the mechanism would be:
— Member Inland Revenue (Operations); focal steward for implementation of VAT Regime over next 2-4 years.
— Director General Input – Output Coefficient Organization (IOCO – IR) should be redesignated as DG IOCO & VAT Compliance – Functional lead for VAT Implementation.
— Commissioner Broadening of Tax Base (BTB) at each Regional Tax Office (RTO)/ Large Taxpayer Unit (LTU) would be responsible for business level implementation – Assistant Commissioner of respective RTO/LTU for Value Chain Evaluation and VAT Implementation.
— VAT would be progressively implemented across various segments commencing with 3rd Schedule products and gradually absorbing complex value chain products.
The meeting considered the implementation of VAT and decided enactment of VAT related legislation, rules and regulation if required.
For the purpose capacity building of FBR for absorption of VAT Regime would be undertaken.
It is also decided that time and resources for VAT assessment surveys of particular industrial/business segment. In order to implement the scheme successfully, the revenue potential of particular industrial segments would be assessed.
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FBR to conduct nation-wide survey of immovable properties to assess wealth parked in real estate sector
ISLAMABAD: Federal Board of Revenue (FBR) will conduct nation-wide survey of immovable properties to assess and tap colossal wealth parked in the real estate sector.
The decision has been taken and approved at a meeting under the chairmanship of the prime minister held last month.
According to minutes of the meeting it has been decided to conduct nation-wide survey of immovable property to assess and tap colossal wealth parked in the real-estate sector.
The survey would be conducted along with geo-tagging within next two years.
It has been considered that Chinese proposal for conducting digitized land survey (digital cartography) of entire country is pending for the last two years.
Proposal for proof of concept of digital survey of Islamabad industrial area (1-9) along with geo-tagging option is already under consideration with FBR.
Proposal of digital nation-wide survey has been approved in principal. Further the digital survey of Islamabad Industrial Area (1-9) with geo-tagging would be undertaken at priority.
It is also decided that nation-wide survey would be undertaken and completed over the next two years while taking Chinese proposal in consideration.
The meeting also considered proposal of nation-wide tax assessment and documentation drive to effectively check tax evasion and ensure documentation of economy.
The documentation drive needs to be undertaken over the next two to three years. The documentation drive will assist in ascertaining untapped segments including businesses, real-estate and industries.
Therefore, it is decided that a comprehensive proposal for nation-wide tax assessment and documentation drive (undertaken over two years) would be formulated.
It is also decided that tax reforms must not create choking effect for the economy. And correct taxation measures would be taken with prompt implementation instead of entanglement in extended impasses.
The meeting discussed the actualization of tax advisory board to alleviate trust deficit, preparation of objective tax policies and improve taxpayers’ awareness.
The tax advisory board (as amended in FBR Act, 2007) needs to be actualized at the ministry of finance (Revenue Division) as formal feedback mechanism for policy level advice on taxation issues.
This will effectively separate tax policy and tax administration functions whereby FBR to act as revenue collection agency only.
In this regard, it is decided that tax advisory board should be actualized immediately to discuss threadbare all taxation policies relieving FBR from additional burden of tax policy formulation.
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Tax authorities to determine values of immovable properties, motor cars on discovery of concealment
ISLAMABAD: The tax authorities shall determine value of immovable properties and motor cars for tax purpose on discovery of concealment by a person or a company.
Officials in Federal Board of Revenue (FBR) said that under Section 111 of Income Tax Ordinance, 2001 any disclosed income or assets will be taken as concealed income and leviable to tax and prevailing fine and penalties.
Income Tax Rules, 2002 has outlined the determination of assets that are concealed by a person or a company.
(1) The valuation of immovable property for the purposes of section 111 shall be taken to be-
(a) the fair market value of immovable property shall be the value notified by the Board under sub-section (4) of section 68, in respect of area or areas specified in the said notifications;
(b) if the fair market value of any immovable property of any area or areas has not been determined by the Board in the notification referred to in sub-section (4) of section 68, the fair market value of such immovable property shall be deemed to be the value fixed by the District Officer (Revenue) or provincial or any other authority authorized in this behalf for the purposes of stamp duty; and
(c) in the case of agricultural land, the value shall be equal to the average sale price of the sales recorded in the revenue record of the estate in which the land is situated for the relevant period or time;
(d) if in a case sale price recorded in the instrument of sale of any property is higher than the fair market value as determined under clauses (a), (b) and (c), the applicable price shall be higher of the two; and
(e) in the case of sale price of any auctioned property or the fair market value as determined under clauses (a), (b) and (c), the higher price shall be applicable.
(2) For the purposes of section 111 and subject to sub-rule (2), the value of motor cars and jeeps shall be determined in the following manner, namely:-
(a) the value of the new imported car or jeep shall be the C.I.F. value of such car or the jeep, as the case may be, plus the amount of all charges, customs-duty, sales tax, levies, octroi fees and other duties and taxes leviable thereon and the costs incurred till its registration;
(b) the value of a new car or jeep purchased from the manufacturer or assembler or dealer in Pakistan, shall be the price paid by the purchaser, including the amount of all charges, customs-duty, sales tax and other taxes, levies, octroi, fees and all other duties and taxes leviable thereon and the costs incurred till its registration;
(c) the value of used car or jeep imported into Pakistan shall be the import price adopted by the customs authorities for the purposes of levy of customs-duty plus freight, insurance and all other charges, sales tax, levies octroi, fees and other duties and taxes leviable thereon and the costs incurred till its registration;
(d) the value of a car or jeep specified in clause (a), (b) and (c) at the time of its acquisition shall be the value computed in the manner specified in the clause (a), (b) or (c), as the case may be, as reduced by a sum equal to ten percent of the said clause for each successive year, upto a maximum of five years; or
(e) the value of a used car or jeep purchased by an assessee locally shall be taken to be the original cost of the car or the jeep determined in the manner specified in clause (a), (b) or (c), as the case may be, as reduced by an amount equal to ten percent for every year following the year in which it was imported or purchased from a manufacturer.
(3) In no case shall the value be determined at an amount less than fifty percent of the value determined in accordance with clause (a), (b) or (c) or the purchase price whichever is more.
(4) For the purposes of section 61, the value of any property donated to a non-profit organization shall be determined in the following manner, namely:-
(a) the value of articles or goods imported into Pakistan shall be the value determined for the purposes of levy of customs duty and the amount of such duty and sales tax, levies, fees, octroi and other duties, taxes or charges leviable thereon and paid by the donor;
(b) the value of articles and goods manufactured in Pakistan shall be the price as recorded in the purchase vouchers and the taxes, levies and charges leviable thereon and paid by the donor;
(c) the value of articles and goods which have been previously used in Pakistan and in respect of which depreciation has been allowed, the written down value, on the relevant date as determined by the Commissioner;
(d) the value of a motor vehicle shall be the value as determined in accordance with rule; and
(e) the value of articles or goods other than those specified above, shall be the fair market value as determined by the Commissioner.
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FBR asks taxpayers to file return by Nov 30 to avoid harsh penalties
ISLAMABAD: Federal Board of Revenue (FBR) has asked persons/companies having taxable income to file their income tax returns for tax year 2019 by November 30, 2019 to avoid harsh penalties including imprisonment up to three years.
The FBR on October 31, 2019 extended the last date for filing income tax returns up to November 30, 2019. The cutoff date for filing returns tax year 2019 was September 30, 2019 in case of salaried persons, business individuals, Association of Persons (AOPs) and companies having special tax year.
The FBR granted first date extension on September 30, 2019 and extended up to October 31, 2019. However, on the request of the stakeholders the FBR further extended the last date up to November 30, 2019.
FBR spokesman in a tweet message asked persons having taxable income to file their income tax returns for tax year 2019 by November 30, 2019 in order to avoid harsh penalties including fine for late filing and imprisonment of one to three years in case of deliberate ignoring mandatory requirement under the statute.
The spokesman said that in case persons failed to file their returns for tax year 2019, then they would be liable to pay double rate of withholding tax. “FBR will assess the applicable tax without serving any notice,” according to the message.
“Legal action will be taken resulting into imprisonment of one to three years,” it added.
Besides, fine will be charged on late submission of income tax returns.
The FBR said that the persons who filed their income tax returns by due date would be added to Active Taxpayers List (ATL), which would be issued on March 01, 2020.
Through Finance Act, 2019 an important 10th Schedule was inserted to Income Tax Ordinance, 2001. Under the schedule persons not appearing on the ATL will be liable to 100 percent more rate of withholding tax on various transactions.
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FPSC to conduct promotion examination of IR inspectors
ISLAMABAD: Federal Public Service Commission (FPSC) will conduct examination for departmental promotion of Inland Revenue (IR) Inspectors, Federal Board of Revenue (FBR) said on Friday.
In compliance of Supreme Court of Pakistan judgment dated June 05, 2017 in Civil Petitions No.2246, 2269, 2270 & 2308 of 2016 and Recruitment Rules notified vide Notification S.R.O. No.728(1)/2014 dated 11.07.2014, the matter regarding departmental promotion examination to the post of Inspector-IR (BS-16) was taken up with the Federal Public Service Commission (FPSC), Islamabad.
On completion of due formalities with FPSC and consultation with Directorate General of Training and Research, Inland Revenue, Lahore the subject examination is to be conducted in near future.
As a first step, the Federal Public Service Commission as informed that they are inviting online application from eligible candidates from November 04, 2019 to November 14, 2019.
In view of the above, all eligible employees o Inland Revenue Department in terms of Recruitment Rules notified vide Notification S.R.O. No. 728(1)/2014 dated July 11, 2014 may be informed to apply online to FPSC for the departmental promotion examination for the post of Inspector IR (BS-16) within the given time frame.
Online application form for the subject purpose will be available at the FPSC website.
Conditions of eligibility for examination are:
— 02 Years Service in BS-14 as Supervisor. Must pass departmental promotion examination in a manner prescribed by Federal Board of Revenue and to be conducted by the Directorate of Training & Research (IR) or FPSC or BY NTS.
— 05 years service in BS-14 as Stenotypist. Must pass departmental promotion examination in a manner prescribed by Federal Board of Revenue and to be conducted by the Directorate of Training & Research (IR) or FPSC or by NTS.
— 07 years service in BS-09 as UDC. Must pass departmental promotion examination in a manner prescribed by the Federal Board of revenue and to be conducted by the Directorate of Training & Research (IR) or FPSC or by NTS.
— 10 years service in BS-07 as LDC. Must pass departmental promotion examination in a manner prescribed by the Federal Board of Revenue and to conducted by the Directorate of Training & Research (IR) or FPSC or by NTS.
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FBR needs around Rs4,267 billion in eight months to achieve FY20 target
ISLAMABAD: The revenue collection target for fiscal year 2019/2020 appears to be more difficult as Federal Board of Revenue (FBR) requires Rs4,267 billion more in remaining eight months to achieve Rs5,550 billion tax collection target for current fiscal year.
The FBR provisionally collected Rs1,283 billion during first four months (July – October) of fiscal year 2019/2020, which is only 23 percent of the total target of Rs5,550 billion set for the current fiscal year.
The FBR is now required to collect Rs533 billion as average monthly collection in the remaining eight months of the current fiscal year, which appears to be tough ask.
In a tweet message, Chairman FBR Shabbar Zaidi on Thursday, “FBR has collected Rs 320 billion during the month October 2019 and has maintained overall increase over last year of 16 percent and domestic tax over 25 percent. This is after taking into account negative aspect of import contraction of around Rs 50 billion.”
Reportedly, the FBR collected Rs566 billion as sales tax during first four months, followed by about Rs468 billion through income and about Rs109 billion in customs.
The remaining Rs137 billion came were collected via other taxes including Rs71 billion in federal excise duty.
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Monthly ST return filing date extended to November 08
ISLAMABAD: Federal Board of Revenue (FBR) on Thursday extended the last date for filing monthly sales tax and federal excise tax return for the month of September 2019 up to November 08, 2019.
A notification issued by the FBR stated that it had further extended the date of submission of sales tax and federal excise return up to November 11, 2019 for the tax period of September 2019, which was due on October 18, 2019 and extended up to October 25, 2019.