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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.

  • PTBA urges FBR to extend date for filing income tax returns

    PTBA urges FBR to extend date for filing income tax returns

    KARACHI: Pakistan Tax Bar Association (PTBA) on Saturday urged Federal Board of Revenue (FBR) to extend the last date for filing income tax returns for Tax Year 2018 up to June 30, 2019 considering the recently launched tax amnesty scheme.

    In a letter to FBR Chairman Syed Muhammad Shabbar Zaidi, the PTBA informed that the Asset Declaration Ordinance, 2019 was announced on May 16, 2019 and the last date for filing declaration is June 30, 2019.

    The PTBA urged the FBR chairman to extend the last date for filing of return of income and statement of final taxation for individuals, Association of Persons (AOPs) and companies (other than public limited companies quoted on stock exchange) to June 30, 2019.

    The last date was already extended by the FBR till April 30, 2019 through Circular No. 03/2019 dated March 31, 2019.

    The apex tax bar said that the extension would encourage the new taxpayers to bring their house in order and come into the mainstream of economic activities by availing the benefit to become active taxpayers.

  • Banks assure providing details of Benami account holders to FBR

    Banks assure providing details of Benami account holders to FBR

    ISLAMABAD: The commercial banks have assured the Federal Board of Revenue (FBR) of providing details of Benami account holders for the purpose of broadening of tax base and documentation of economy.

    An important meeting was held on Thursday of all chief financial officers with Syed Muhammad Shabbar Zaidi, chairman, FBR.

    The CFOs of all commercial banks assured complete cooperation to the FBR chairman in providing details of account holders in order to broaden the tax base.

    The participants of commercial banks included Chief Financial Officers of Allied Bank, United Bank, Habib Bank and others.

    They assured their full cooperation to the Chairman FBR and welcomed his appointment as Chairman FBR.

    The Chairman FBR thanked the Chief Financial Officers.

    FBR sources said that the meeting was important related to next review of Financial Action Task Force (FATF) on Pakistan.

    It is learnt that huge amount of money laundering was done through Benami bank accounts besides those were also used for tax evasion.

    The FBR chairman has already made it clear that the current amnesty scheme is the last opportunity for people having undeclared income and assets.

  • ICAP proposes restricting powers of Directorate General Intelligence and Investigation

    ICAP proposes restricting powers of Directorate General Intelligence and Investigation

    KARACHI: Institute of Chartered Accountants of Pakistan (ICAP) has proposed restricting powers of Directorate General of Intelligence and Investigation (I&I) as multiple powers of tax authorities are causing hardship for taxpayers.

    The ICAP in its tax proposals for budget 2019/2020 said that the Federal Board of Revenue (FBR) through SRO 115 (I)/2015 dated February 09, 2015 conferred upon the Directorate General (Intelligence and Investigation), Inland Revenue, the powers of the Chief Commissioner/Commissioner:

    — to exercise powers and perform functions under Sections 174, 175, 176, 177 (other than power to initiate audit), 178, 179, 180, 181, 182, Part III, Part XI of Chapter X, Sections 205 and 221; and

    — to investigate Suspicious Transactions Reports (STRs) or other assets of persons or classes of persons impounded by any department or agency of the Federal or Provincial government and prepare/transmit reports to respective RTOs or LTUs for the purpose of application of Section 111 and for taking appropriate action under the Income Tax Ordinance, 2001.

    The ICAP recommended that the law should be amended so that the authority of Director General Intelligence and Investigation is exercised only to investigate Suspicious Transactions Reports (STRs) or other assets of persons or classes of persons impounded by any department or agency of the Federal or Provincial government and prepare / transmit reports to respective RTOs or LTUs for the purpose of application of Section 111 and for taking appropriate action under the Income Tax Ordinance, 2001 and should not exercise the powers under various sections of the Ordinance.

    The creation of parallel authorities for the purpose of sections 174, 175, 176, 177, 178, 179, 180, 181, 182, Part III, Part XI of Chapter X, Sections 205 and 221 is causing problems to the taxpayers.

  • Monitoring of Withholding Tax: FBR launches mega operation against textile, sugar companies for tax evasion

    Monitoring of Withholding Tax: FBR launches mega operation against textile, sugar companies for tax evasion

    ISLAMABAD: Federal Board of Revenue (FBR) has launched mega crackdown against textile and sugar sectors for suppressing sales and evading tax by issuing fake and flying invoices.

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  • IR offices directed to observed extended working hours to facilitate taxpayers

    IR offices directed to observed extended working hours to facilitate taxpayers

    The Federal Board of Revenue (FBR) has taken a proactive step to facilitate taxpayers by directing offices of Inland Revenue (IR) to observe extended working hours.

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  • FBR withdraws zero-rate facility to textile unit for no business activity at declared address

    FBR withdraws zero-rate facility to textile unit for no business activity at declared address

    KARACHI: Federal Board of Revenue (FBR) suspended zero-rated sales tax facility on supply of electricity and gas to a textile unit for not operational at declared place of business activity.

    The FBR issued Sales Tax General Order (STGO) No. 98 and 99 to withdraw the sales tax zero-rated facility on supply of electricity and gas to M/s. Teetex Industries because the unit was no more operational at the declared place.

    The FBR directed Chief Commissioner Inland Revenue, Corporate Regional Tax Office, Karachi to coordinate with K-Electric and SSGCL regarding implementation of the amendment in the general order and submit report in respect of action taken/ recovery made, if any, for misuse of the facility.

    The FBR also asked K-Electric and Sui Southern Gas Company Limited to start charging sales tax on the supply of electricity and gas to the taxpayers with immediate effect.

  • FBR urged to extend tax credit to investment in infrastructure

    FBR urged to extend tax credit to investment in infrastructure

    KARACHI: Federal Board of Revenue (FBR) has been urged to extend tax credit facility to investment in factory building and manufacturing related infrastructure.

    Pakistan Tax Bar Association (PTBA) in its tax proposals for budget 2019/2020 said that tax credit under section 65E of Income Tax Ordinance, 2001 is restricted to investment in plant and machinery.

    Tax credit under section 65D is available only at the time of setting up a new industrial undertaking. No tax credit is given on subsequent expansion of such an industrial undertaking since section 65E restricts eligibility to companies formed before 01 July, 2011.

    Expansion of plant or undertaking a new project involves investment in factory building and manufacturing related infrastructure and as such, these types of investments should also be made eligible for tax relief.

    Expansion is also possible in industrial units’ set-up after 01 July, 2011.

    It is, therefore, recommended that tax credit under section 65E should also be extended to investment in factory building and manufacturing related infrastructure.

    Applicability of section 65E to only such companies’ setup after 01 July, 2011 may be relaxed to include industrial undertakings formed thereafter as well, which undergo expansion.

    An increased availability of tax credits may act as an incentive to new investment since the investors foresee tax benefits which they may practically be able to utilize.

    The tax bar further highlighted that tax credits under sections 65B and 65E are restricted to investment in plant and machinery.

    The rational behind these tax credits is not the purchase of plant and machinery but industrial expansion and increased economic activity. In this regard, it may be appreciated that expansion of business (and the consequent increase in economic activity) is not achieved from plant and machinery in isolation and is, for all practical purposes, not possible without an appropriate support structure.

    In order to streamline section 65B(4) with the wordings of section 65B(1), the following wording, in bold, may be inserted:-

    “65B (4) make an investment for the purposes of extension, expansion, balancing, modernization and replacement of the plant and machinery.”

    An explanation be added to sub-section (1) of Section 65B:-

    “For removal of doubts, for the purposes of this section, it is declared that the words “purchase of a plant and machinery” includes all direct expenses which are necessary to make the Plant and Machinery in a workable condition and also includes factory buildings and manufacturing related infrastructure.”

    Tax credit under Section 65E should also be extended to investment in factory building and manufacturing related infrastructure, the PTBA recommended.

    The proposed amendment/modification in tax credits will clarify the ambiguity for the companies’ set-up before first day of July, 2011 and shall promote industrial expansion and increased economic activity.

  • FBR asks refund claimants to open CDC account

    FBR asks refund claimants to open CDC account

    KARACHI: Federal Board of Revenue (FBR) has asked taxpayers, who opted for a sales tax refund through bonds, to open their accounts with the Central Depository Company (CDC).

    In an advisory issued on Monday, the FBR said that refund claimants who have opted for sales tax payments through bonds should open investor account with the CDC if they do not already have such accounts.

    FBR said that refund claimants who have opted for payment through bonds but have not provided proper CDC account as per given format, can update CDC accounts by visiting FBR website.

  • FBR bans entry of unauthorized persons, Lappoos into custom houses

    FBR bans entry of unauthorized persons, Lappoos into custom houses

    KARACHI: Federal Board of Revenue (FBR) has restricted entry of unauthorized persons, including privately hired persons by customs officials (Lappoos), into custom houses with immediate effect.

    In a statement issued on Monday, Pakistan Customs said that FBR chairman Syed Muhammad Shabbar Zaidi ordered the ban on entry of unauthorized persons into customs station in order to ensure transparency in clearance system.

    The FBR chairman while taking notice of presence of large number of visitors for making the entire clearance system doubtful, had ordered Customs Wing to strictly restrict, entry into Customs Houses, only to the concerned traders, their authorized representatives and members and relevant trade bodies/ associations.

    Accordingly Customs Wings is in process of issuing instructions to its field formations for immediately restricting entry of all un-authorized persons, the statement said.

    The visiting hours for traders and their authorized representatives for fulfillment of needed legal formalities in cases involving second review before Assistant / Deputy Collectors shall be limited from 10:00 Am to 1:00 PM.

    The press release said that Pakistan Customs is operating its Web Based One Customs (WeBOC) system in order to facilitate the trade and provide ease of doing business in carrying out imports, exports and transit trade.

    This system is available 24/7 and allows on-line submission and processing of documents as well as electronic payments of duty and taxes.

    As such the need for traders and their representatives to physically visit offices of Customs has drastically been reduced.

  • FBR suggested reduced corporate tax rate for job creation

    FBR suggested reduced corporate tax rate for job creation

    KARACHI: Federal Board of Revenue (FBR) has been suggested to reduce corporate tax rate by one percent for companies creating 50 or more new jobs in a year.

    Pakistan Business Council (PBC) in its tax proposals for budget 2019/2020 suggested the government to reduce tax rate for companies creating more jobs during a year.

    “One percent lower tax rate for existing companies that create 50 or more new jobs on their own payroll in a year.”

    Giving rationale to the proposal, the PBC said that Pakistan needs to find employment for two million youth each year.

    The PBC further suggested first year depreciation allowance for investment in making upgrades to the provision of facilities (including lifts, ramps) for the specially challenged in the workplace or business.

    It further suggested 0.5 percent lower tax rate for providing livelihoods to specially challenged persons equal to five percent of the workforce.

    Giving rationale to the changes, the PBC said that in order to demonstrate a commitment to creating livelihoods for all and work toward target of sustainable development goal – “By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value.”

    It further said that no or limited facilities that allow access in the workplace or business for the specially challenged thereby deterring the disabled from working.