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.

Advance tax on electronic media, cable operators

KARACHI: Electronic media and cable operators are required to pay adjustable advance tax at the time of obtaining new license or renewal of license.

According to updated Income Tax Ordinance, 2001 issued by the Federal Board of Revenue (FBR), Pakistan Electronic Media Regulatory Authority (PEMRA) shall collect the advance tax at the time of issuance of licence for distribution services or renewal of the licence to a licencee under Section 236F of the Ordinance.

Section 236F: Advance tax on cable operators and other electronic media

Sub-Section (1): Pakistan Electronic Media Regulatory Authority, at the time of issuance of licence for distribution services or renewal of the licence to a licencee, shall collect advance tax at the rates specified in Division XIII of Part IV of the First Schedule.

(1) The rate of tax to be collected under section 236F in the case of Cable Television Operator shall be as follows:—

License Category as provided in PEMRA Rules	Tax on License Fee	Tax on Renewal
H	Rs. 7,500	Rs. 10,000
H-I	Rs. 10,000	Rs. 15,000
H-II	Rs. 25,000	Rs. 30,000
R	Rs. 5,000	Rs. 12,000
B	Rs. 5,000	Rs. 40,000
B-1	Rs. 30,000	Rs. 35,000
B-2	Rs. 40,000	Rs. 45,000
B-3	Rs. 50,000	Rs. 75,000
B-4	Rs. 75,000	Rs. 100,000
B-5	Rs. 87,500	Rs. 150,000
B-6	Rs. 175,000	Rs. 200,000
B-7	Rs. 262,500	Rs. 300,000
B-8	Rs. 437,500	Rs. 500,000
B-9	Rs. 700,000	Rs. 800,000
B-10	Rs. 875,500	Rs. 900,000

(2) The rate of tax to be collected by Pakistan Electronic Media Regulatory Authority under section 236F in the case of IPTV, FM Radio, MMDS, Mobile TV, Mobile Audio, Satellite TV Channel and Landing Rights, shall be 20 per cent of the permission fee or renewal fee, as the case may be.

“(3) In addition to tax collected under paragraph (2) Pakistan Electronic Media Regulatory Authority shall collect tax at the rate of fifty per cent of the permission fee or renewal fee, as the case may be, from every TV Channel on which foreign TV drama serial or a play in any language, other than English, is screened or viewed.”

Sub-Section (2): The tax collected under sub-section (1) shall be adjustable.

Sub-Section (3): For the purpose of this section, “cable television operator” “DTH”, “Distribution Service”, “electronic media”, “IPTV”, “loop holder”, “MMDS”, “mobile TV”, shall have the same meanings as defined in Pakistan Electronic Media Regulatory Authority Ordinance, 2002 (XIII of 2002) and rules made thereunder.

March 19, 2019

Asad Umar reviews revenue collection, broadening of tax base

KARACHI: Finance Minister Asad Umar on Monday reviewed the revenue collection progress and ongoing drive of broadening of tax base at a meeting with senior officials of Federal Board of Revenue (FBR).
The meeting was attended by Member Inland Revenue Operations Ms. Seema Shakil, Member Customs Operations Agha Jawad, Chief Commissioners Inland Revenue and Chief Collectors of Pakistan Customs.
Ms. Seema Shakil updated the finance minister about revenue collection and performance of Inland Revenue besides giving details of ongoing campaign for broadening of tax base.
She apprised the finance minister about the difficulties in the way of taking harsh action against tax evaders.
The sources said that the finance minister issued directives for taking harsh measures against tax evaders including high profile cases.
He also assured all logistic support to FBR officials in taking actions against influential persons.

Member Customs Operations Agha Jawad also briefed the finance minister about the working of customs clearance. The member said that transparency had been ensured in the clearance process in order to facilitate genuine taxpayers.
The member pointed out high volume of smuggled betel nut.
The finance minister directed to evolve a tariff mechanism for betel nut.
The finance minister directed both the wings of FBR to ensure facilitation of taxpayers and focus on tax evaders.

March 19, 2019
FBR adds over 114,000 return filers to ATL

ISLAMABAD: Federal Board of Revenue (FBR) has added over 114,000 return filers to Active Taxpayers List (ATL) following the grant of extension in filing income tax returns for Tax Year 2018 up to March 31, 2019.

The FBR issued weekly updated ATL 2018 on Monday, which showed the number of active taxpayers increased to 1.75 million.

The FBR issued first ATL 2018 on March 01, 2019 which had carried 1.6 million taxpayers in the list.

The appearance of ATL is mandatory for availing reduced rate of withholding tax rate and other benefits available only to return filers.

Through Finance Act, 2018, a section 182A was inserted to Income Tax Ordinance, 2001 which barred the late filers to appear on the ATL.

Therefore, the ATL issued on March 01, 2019 only those taxpayers were included who filed their returns by December 15, 2018 in case of salaried persons, business individuals and companies with special years and December 31, 2018 for companies with normal tax year.

However, the FBR last week extended the last date for filing income tax returns for all classes of taxpayers. Hence, those taxpayers who have filed their returns after December 15 or December 31 became eligible for ATL.

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Late filers to become part of ATL as FBR extends last date for filing return up to March 31

March 18, 2019
FBR to improve capacity for action against tax evaders

KARACHI: Federal Board of Revenue (FBR) is increasing its capacity to handle large size data of tax evaders, FBR chairman said in a meeting with members of Karachi Chambers of Commerce and Industry (KCCI).
(more…)

March 18, 2019

Income Tax Ordinance 2001: amended advance tax rates on marriages, functions

KARACHI: Federal Board of Revenue (FBR) has updated advance tax rates on marriages and functions through latest amendment to Income Tax Ordinance, 2001.
The national assembly recently approved Finance Supplementary (Second Amendment) Act, 2019 and advance tax rate for functions and gathering has been updated.
The advance tax is collected under following section of the Ordinance.
Section 236D: Advance tax on functions and gatherings
Sub-Section (1): Every prescribed person shall collect advance tax at the rate specified in Division XI of Part IV of the First Schedule on the total amount of the bill from a person arranging or holding a function in a marriage hall, marquee, hotel, restaurant, commercial lawn, club, a community place or any other place used for such purpose.
Sub-Section (2): Where the food, service or any other facility is provided by any other person, the prescribed person shall also collect advance tax on the payment for such food, service or facility at the rate specified in Division XI of Part IV of the First Schedule from the person arranging or holding the function.
Sub-Section (3): The advance tax collected under sub-section (1) and sub-section (2) shall be adjustable.
Sub-Section (4): In this section,—
(a) “function” includes any wedding related event, a seminar, a workshop, a session, an exhibition, a concert, a show, a party or any other gathering held for such purpose; and
(b) “prescribed person” includes the owner, a lease-holder, an operator or a manager of a marriage hall, marquee, hotel, restaurant, commercial lawn, club, a community place or any other place used for such purpose.
The rate of tax to be collected under each sub-sections (1) and (2) of section 236D shall be 5%;
Provided that the rate for the function of marriage in a marriage hall, marquee, hotel, restaurant, commercial lawn, club, a community place or any other place used for such purpose shall be as set out in the Table below:─

S. No.	Rate of tax
01	5% of the bill ad valorem or Rs20,000 per function, whichever is higher	For Islamabad, Lahore, Multan,Faisalabad, Rawalpindi, Gujranwala, Bahawalpur, Sargodha, Sahiwal, Shekhurpura, Dera Ghazi Khan, Karachi, Hyderabad, Sukkur, Thatta, Larkana, Mirpur Khas, Nawabshah, Peshawar, Mardan, Abbottabad, Kohat, Dera Ismail Khan, Quetta, Sibi, Loralai, Khuzdar, Dera Murad Jamali and Turbat.
02	5% of the bill ad valorem or Rs10,000 per function, whichever is higher	For cities other than those mentioned above.

Through Finance Supplementary (Second Amendment) Act, 2019, the following amendment has been inserted:
“Provided further that the rate for the function of marriage in a marriage hall, marquee or a community place with the total function area less than 500 square yards or, in case of a multi-stories premises, with the largest total function area on one floor less than 500 square yards, shall be 5 percent of the bill ad valorem or Rs5,000 function whichever is higher.”
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March 18, 2019

Filing annual return: large number to benefit from date extension

KARACHI: A large number of taxpayers may file their annual income tax returns while taking advantage of date extension up to March 31, 2019, tax manager said.

The Federal Board of Revenue (FBR) recently extended the last date for filing income tax return for tax year 2018 up to March 31, 2018, which was December 15, 2018 for salary, business individuals, taxpayers falling in final tax regime and companies having special tax year.

Similarly, the date was also extended for corporate units up to March 31, 2019, whose last date was December 31, 2018.

The tax managers said that due to burden and restrictions on non-filers under Income Tax Ordinance, 2001 a huge number of individuals and companies would file their income tax returns for tax year 2018 to appear on Active Taxpayers List (ATL).

They said that the non-filers have been restricted in purchasing immovable properties over Rs40 million and registration of imported motor vehicles.

Further, the non-filers are also required to pay higher percent of withholding tax on various transactions. The non-filers in the recent mini-budget allowed to purchase and register new locally assembled motor vehicles. However, the withholding tax rates on non-filers have been increased by 50 percent.

The ATL issued by FBR on March 01, 2019 for tax year 2018 carried list of 1.59 million active taxpayers. In contrast the ATL for the tax year 2017 had carried 1.84 million active taxpayers, which showed about 240,000 taxpayers were not on the new list.

With the extension of date up to March 31, 2019 the return filers would not require to pay penalty and also become eligible for appearing on the ATL.

To some estimates the recent date extension by the FBR around 250,000 to 300,000 more returns would be added to the current active taxpayers list.

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Late filers to become part of ATL as FBR extends last date for filing return up to March 31

March 17, 2019
Income Tax Ordinance 2001: advance tax on sale, purchase of immovable properties

KARACHI: Adjustable advance tax is applicable for filers and non-filers of income tax return on sales and purchase of immovable properties to be collected at the time of transaction.

According to updated Income Tax Ordinance, 2001 issued by Federal Board of Revenue (FBR) the tax shall be collected under Section 236C and Section 236K of the Ordinance, which are as follow:

Section 236C: Advance Tax on sale or transfer of immovable Property
Sub-Section (1): Any person responsible for registering, recording or attesting transfer of any immovable property shall at the time of registering, recording or attesting the transfer shall collect from the seller or transferor advance tax at the rate specified in Division X of Part IV of the First Schedule:

“The rate of tax to be collected under section 236C shall be 1% of the gross amount of the consideration received for filers and 2% of the gross amount of the consideration received for non-filers.”

Explanation,—For removal of doubt, it is clarified that the person responsible for registering, recording or attesting transfer includes person responsible for registering, recording or attesting transfer for local authority, housing authority, housing society, co-operative society and registrar of properties.

Provided that this sub-section shall not apply to a seller, being the dependant of a Shaheed belonging to Pakistan Armed Forces or a person who dies while in the service of the Pakistan Armed Forces or the service of Federal or Provincial Government, in respect of first sale of immovable property acquired from or allotted by the Federal Government or Provincial Government or any authority duly certified by the official allotment authority, and the property acquired or allotted is in recognition of or for services rendered by the Shaheed or the person who dies in service.

Sub-Section (2): The Advance tax collected under sub-section (1) shall be adjustable:

Provided that where immovable property referred to in sub-section (1) is acquired and disposed of within the same tax year, the tax collected under this section shall be minimum tax.

Sub-Section (3): Advance tax under sub-section (1) shall not be collected if the immovable property is held for a period exceeding three years.

Section 236K: Advance tax on purchase or transfer of immovable property

Sub-Section (1): Any person responsible for registering, recording or attesting transfer of any immovable property shall at the time of registering, recording or attesting the transfer shall collect from the purchaser or transferee advance tax at the rate specified in Division XVIII of Part IV of the First Schedule.

The rate of tax to be collected under section 236K shall be:-

S. No Period Rate of Tax
01 Where value of immovable property is up to Rs4 million Zero percent
02 Where the value of immovable property is more than Rs4 million Filer 2 percent
Non-filer 4 percent

Explanation,—For removal of doubt, it is clarified that the person responsible for registering, recording or attesting transfer includes person responsible for registering, recording or attesting transfer for local authority, housing authority, housing society, co-operative society and registrar of properties.

Sub-Section (2): The advance tax collected under sub-section (1) shall be adjustable.

Sub-Section (3): Any person responsible for collecting payments in installments for purchase or allotment of any immovable property where the transfer is to be effected after making payment of all installments, shall at the time of collecting installments collect from the allotee or transferee advance tax at the rate specified in Division XVIII of Part IV of the First Schedule.

Sub-Section (4): Nothing contained in this section shall apply to a scheme introduced by the Federal Government, or Provincial Government or an Authority established under a Federal or Provincial law for expatriate Pakistanis:

“Provided that the mode of payment by the expatriate Pakistanis in the said scheme or schemes shall be in the foreign exchange remitted from outside Pakistan through normal banking channels.”

March 17, 2019
Difficult time for people not in tax net: FBR chairman

KARACHI: The chairman of Federal Board of Revenue (FBR) Mohammad Jehanzeb Khan on Saturday said that difficult time has started for those having taxable income but still out of tax net.

He was addressing the business community at Karachi Chamber of Commerce and Industry (KCCI).

The chairman said that it was difficult to bring change in any organization yet we are ready to bring changes in the FBR.

He said that the tax collecting agency should be a facilitator and the business community is our partner.

“There is need to boost confidence on tax agency,” he added.

He said that the tax collecting agency was ready to reduce sales tax rates as well to broaden the tax net.

The chairman praised the business community for contributing into economic growth and generating employment.

He said that if a person made short payment then he should not be treated as tax evader. “And those who are paying taxes should not be worried,” he added.

Jehanzeb admitted that there were difficulties in revenue collection but he said that the FBR would not take any harsh action.

The chairman said that the FBR had immense powers and warned that these powers would be exercised if needed.

March 16, 2019
FBR recovers Rs1.85 billion from tax evaders: Jehanzeb Khan

KARACHI: Mohammad Jehanzeb Khan, Chairman, Federal Board of Revenue (FBR) on Saturday said that the revenue body recovered Rs1.85 billion from tax evaders.

Talking at Federation of Pakistan Chambers of Commerce and Industry (FPCCI), he said that the revenue body had issued 6,000 notices for recovery of Rs3 billion.

The chairman said that the government was endeavoring to increase trade volume in Balochistan and the FBR was considering to increase the customs staff in the province.

Talking about sales tax refunds, he said that this amount was not belong to FBR and it had to be reimbursed.

The chairman said that penalty would not be imposed on those taxpayers who applied for reviewing their income tax returns.

Dilating upon Benami assets, he said that a separate section in the law was being creating for benami assets. He said that under this law the FBR would able to seize the undeclared assets in someone else names.

Jehanzeb Khan said that the FBR was facing a shortfall of Rs 220 billion.

He said that the FBR was enhancing capacity in customs clearance. The chairman said that work had been started to eliminate under invoicing. Further valuation on imported goods has also been streamlined, he added.

The chairman said that FATF issue was important and the customs authorities had made efforts in this regard.

March 16, 2019
FBR notifies transfers, postings of 21 IRS officers

ISLAMABAD: Federal Board of Revenue (FBR) on Friday notified transfers and postings of 21 officers of BS-17-21 Inland Revenue Service (IRS) with immediate effect and until further orders.

Following IRS officers have transferred and posted:

01. Muhammad Ashfaq Ahmad (Inland Revenue Service/BS-21) has been transferred and posted as Director General, (International Taxes (Operations) Federal Board of Revenue (Hq), Islamabad from the post of Chief, (International Taxes) Federal Board of Revenue (Hq), Islamabad.

02. Abdul Hameed Memon (Inland Revenue Service/BS-20) has been transferred and posted as Chief, (IR-Policy) Federal Board of Revenue (Hq), Islamabad from the post of Chief, (IR-Operations) Federal Board of Revenue (Hq), Islamabad.

03. Rizwan Ahmed Urfi (Inland Revenue Service/BS-20) has been transferred and posted as Chief, (Legal Wing) Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, (IP/TFD/HRM) Regional Tax Office, Gujranwala.

04. Imtiaz Ali Solangi (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (IP/TFD) Corporate Regional Tax Office, Karachi from the post of Commissioner, (Zone-VI) Corporate Regional Tax Office, Karachi.

05. Javaid Iqbal (Inland Revenue Service/BS-20) has been transferred and posted as Chief, (Accounting Wing) Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, (HRM) Regional Tax Office, Rawalpindi.

06. Muhammad Shaukat Hayat Cheema (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (East Zone) Regional Tax Office, Islamabad from the post of Commissioner, (WHT) Regional Tax Office, Islamabad. He is also assigned the additional charge of the post of Commissioner-IR (WHT), RTO, Islamabad

07. Masood Akhtar (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (Bahawalpur Zone) Regional Tax Office, Bahawalpur from the post of Commissioner, (East Zone) Regional Tax Office, Islamabad.

08. Shabih-ul-Aijaz (Inland Revenue Service/BS-20) has been transferred and posted as Chief, (IR-Policy) Federal Board of Revenue (Hq), Islamabad from the post of Commissioner, (HRM) Large Taxpayers Unit, Lahore.

09. Saleem Akhtar (Inland Revenue Service/BS-20) has been transferred and posted as Chief, (IPMU) Federal Board of Revenue (Hq), Islamabad from the post of Chief, Federal Board of Revenue (Hq), Islamabad.

10. Muzaffar Ali Soomro (Inland Revenue Service/BS-20) has been transferred and posted as Commissioner Inland Revenue (WHT) Regional Tax Office, Quetta from the post of Commissioner, (Bahawalpur Zone) Regional Tax Office, Bahawalpur.

11. Said Munaf (Inland Revenue Service/BS-19) has been transferred and posted as Secretary, (IR-Operations) Federal Board of Revenue (Hq), Islamabad from the post of Secretary, (Strategic Planning Reforms & Statistics) Federal Board of Revenue (Hq), Islamabad.

12. Ms. Bushra Jaffar (Inland Revenue Service/BS-19) has been transferred and posted as Additional Commissioner Inland Revenue Regional Tax Office II, Lahore from the post of Secretary, Federal Board of Revenue (Hq), Islamabad.

13. Syed Hasan Sardar (Inland Revenue Service/BS-18) has been transferred and posted as Second Secretary, (IR-Policy) Federal Board of Revenue (Hq), Islamabad from the post of Deputy Commissioner, (IR) Regional Tax Office, Islamabad.

14. Ms. Qayyum Rani (Inland Revenue Service/BS-18) has been transferred and posted as Deputy Commissioner Inland Revenue (AEOI Zone) Large Taxpayers Unit, Lahore from the post of Deputy Commissioner, (IR) Large Taxpayers Unit, Lahore.

15. Shahid Ijaz Tarar (Inland Revenue Service/BS-18) has been transferred and posted as Second Secretary, (Legal Wing) Federal Board of Revenue (Hq), Islamabad from the post of Second Secretary, (FATE Wing) Federal Board of Revenue (Hq), Islamabad.

16. Muhammad Adil Khan (Inland Revenue Service/BS-18) has been transferred and posted as Second Secretary, (IR-Operations) Federal Board of Revenue (Hq), Islamabad from the post of Second Secretary, (Lit-HC) Federal Board of Revenue (Hq), Islamabad.

17. Hassan Bin Izhar (Inland Revenue Service/BS-18) has been transferred and posted as Second Secretary, (SPR&S Wing) Federal Board of Revenue (Hq), Islamabad from the post of Second Secretary, (Inland Revenue Policy Wing) Federal Board of Revenue (Hq), Islamabad.

18. Ms. Romana Alam (Inland Revenue Service/BS-18) has been transferred and posted as Second Secretary, (IR-Policy) Federal Board of Revenue (Hq), Islamabad from the post of Deputy Commissioner, (IR) Regional Tax Office, Islamabad.

19. Muhammad Salamat Ullah (Inland Revenue Service/BS-17) has been transferred and posted as Second Secretary, (IR-Policy) Federal Board of Revenue (Hq), Islamabad from the post of Assistant Commissioner (Prob), Regional Tax Office, Rawalpindi.

20. Muhammad Siddique (Inland Revenue Service/BS-17) has been transferred and posted as Assistant Commissioner Inland Revenue Regional Tax Office II, Lahore from the post of Assistant Commissioner, Regional Tax Office, Faisalabad.

21. Nasir Maqbool Hashmi (Inland Revenue Service/BS-17) has been transferred and posted as Assistant Commissioner Inland Revenue Regional Tax Office, Islamabad from the post of Assistant Commissioner, Regional Tax Office, Abbottabad.

The FBR said that the officers who are drawing performance allowance prior to issuance of this notification shall continue to draw this allowance on the new place of posting.

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March 15, 2019

S. No	Period	Rate of Tax
01	Where value of immovable property is up to Rs4 million	Zero percent
02	Where the value of immovable property is more than Rs4 million	Filer 2 percent
Non-filer 4 percent