Tag: non-filers

Advance tax rates enhanced by 50pc for non-filers on motor vehicle purchase

KARACHI: The government has allowed non-filers to purchase locally manufactured motor vehicles but at the same time the advance tax rates for non-compliant taxpayers have been increased by 50 percent.

Federal Board of Revenue (FBR) said that the rates have been revised upward on purchase and registration of new locally manufactured cars by non-filers and these rates would be applicable from the date of approval of Finance Supplementary (Second Amendment) Act, 2019.

Following are the rates for non-filers on purchase of motor vehicles:

S. No	Engine capacity	Old rates	New rates
01	Up to 850cc	Rs10,000	Rs15,000
02	851cc to 1000cc	Rs25,000	Rs37,500
03	1001cc to 1300cc	Rs40,000	Rs60,000
04	1301cc to 1600cc	Rs100,000	Rs150,000
05	1601cc to 1800cc	Rs150,000	Rs225,000
06	1801cc to 2000cc	Rs200,000	Rs300,000
07	2001cc to 2500cc	Rs300,000	Rs450,000
08	2501cc to 3000cc	Rs400,000	Rs600,000
09	Above 3000cc	Rs450,000	Rs675,000

March 13, 2019

Motor vehicle purchase restriction on non-filers withdrawn

ISLAMABAD: The federal government has allowed non-filers of income tax returns to purchase locally manufactured motor vehicles.

According to Finance Supplementary (Second Amendment) Act, 2019, the government lifted the mandatory condition of return filing for purchase of motor car.

Further through the Act, non-resident Pakistani citizens holding international passport have also been allowed to registered imported or locally manufactured cars.

“227C. Restriction on purchase of certain assets

Notwithstanding anything contained in any law, for the time being in force,—

(a) any application for booking, registration or purchase of a new locally manufactured motor vehicle or for first registration of an imported vehicle shall not be accepted or processed by any vehicle registering authority of Excise and Taxation Department or a manufacturer of a motor vehicle respectively, unless the person is a filer.; and

(b) any application or request by a person to any authority responsible for registering, recording or attesting transfer of any immovable property, exceeding five million rupees, for registering or attesting the transfer shall not be accepted or processed by such authority, unless the person is a filer:

“Provided that the provisions of clause (a) shall not apply in respect of,─

(i) locally manufactured motor vehicle; or

(ii) a person holding a Pakistan origin card or a national identity card for overseas Pakistanis or a non-resident Pakistani citizen holding international passport who produces a certificate from a scheduled bank of receipt of foreign exchange remitted from outside Pakistan through normal banking channels during a period of sixty days prior to the date of booking, registration or purchase of motor vehicle:

Provided further that the provisions of clause (b) shall not apply to,─

(i) a legal heir acquiring property in inheritance; or

(ii) a person holding a Pakistan origin card or a national identity card for overseas Pakistanis or a non-resident Pakistani citizen holding international passport who produces a certificate from a scheduled bank for receipt of foreign exchange remitted from outside Pakistan through normal banking channels during a period of sixty days prior to the date of registering, recording or attesting transfer.”

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Finance Supplementary (2nd Amendment) Act 2019: FBR to issue sales, income tax refund bonds

March 12, 2019
Legislation to encourage tax non-compliance

KARACHI: All efforts of tax collecting agency in broadening of tax base will be in vain due to changes introduced to tax laws by the present government, which allows non-compliant taxpayers to make transactions.

The government through Finance Supplementary (Second Amendment) Bill, 2019, which was passed by the national assembly, allowed non-filers of income tax returns to purchase locally assembled motor vehicles of any engine capacity.

Though the decision was made to generate more revenue through high rate of withholding tax for non-filers but this would discourage compliant taxpayers.

Whereas through Finance Act, 2018 a Section 182A late filers of income tax returns have been deprived of appearing on the Active Taxpayers List (ATL), which is mandatory for availing reduced withholding tax rates applicable on various transactions for compliant taxpayers.

In a realistic approach if the government allowed late filers, who filed their returns after due date, to appear on the ATL then more people would file their returns in order to purchase motor vehicles as it has been done in the case of purchasing immovable properties.

Another change brought through Finance Supplementary (Second Amendment) Bill, 2019 was allowing commercial importers into Final Tax Regime (FTR).

It is surprising that business community belonging to industrial associations strongly proposed bringing commercial importers into the FTR from minimum tax regime, where tax rates are comparatively lower.

It is obvious that the commercial importers do not want to declare their transactions and want to stay remain out of audit proceedings.

The government has already allowed several concessions and exemptions to industrial sector, especially the export sector for importing raw material.

Allowing commercial importers an audit free regime when the country is facing challenges of money laundering will be problematic.

It is pertinent to mention here that associations of foreign investors and multinational companies do not want relaxation to commercial importers and termed it would be counterproductive for documentation of economy.

March 9, 2019
KTBA requests FBR to include late-filers’ name into ATL

KARACHI: The Karachi Tax Bar Association (KTBA) on Thursday requested tax authorities to include names of late filers of income tax returns, who already applied for extension, into Active Taxpayers List (ATL).

The KTBA requested the chairman of Federal Board of Revenue (FBR) to issue instructions for inclusion of the names of those taxpayers who had duly applied for extension for filing of return of income and the rejection order of which was not passed by the commission and they filed return of income by the requested due date and also those taxpayers who are registered with FBR after June 2018 and are entitled for inclusion as per SRO831(I)/2015 dated August 21, 2015 in the ATL issued by the FBR.

It said that the instruction will be in accordance with the true spirit of law and for the facilitation of taxpayers who fulfilled their responsibility as compliant taxpayers and will also encourage new taxpayers, consequently helping in increasing the tax base.

The tax bar further said that it cannot be considered reasonable that these taxpayers should be treated as non-filer for the entire next year equating them with those non-filers who did not even bother to file return at all and you will be agree that both should not be treated in the same manner.

Under Section 182A of Income Tax Ordinance, 2001 the taxpayers, who filed their returns after due date, have been denied to have their names into ATL for tax year 2018.

March 7, 2019
Local car assemblers to be beneficiary on concession to non-compliant taxpayers

KARACHI: The local car assemblers are main beneficiary of the government decision to allow non-compliant taxpayers for purchasing motor vehicles, analysts said on Thursday.

A day earlier on floor of the house Finance Minister Asad Umar presented this proposal to the Finance Supplementary (Second Amendment) Bill, 2019 to allow non-filers of income tax returns to purchase any engine capacity of motor vehicles.

Though the decision has been taken to generate tax revenue through collection of withholding tax on purchase of motor vehicles as non-filers are required to pay higher rate but it seems to be a big ‘U’ turn by the present government.

The PML-N government in its last budget 2018/2019 announced to imposed restriction on non-filers to purchase motor vehicles of any engine capacity in order to bring large number of tax evaders into tax net.

The present PTI government however in its Finance Supplementary (Second Amendment) Bill, 2019 initially proposed to allow non-filers for purchasing motor vehicles with engine capacity up to 1300CC. However, finalizing this bill and approval from the parliament the concession to non-filers further enhanced and now they would be able to purchase any engine capacity motor vehicle.

The analysts at Taurus Securities Limited said that the Supplementary Finance (Second Amendment) Bill, commonly known as the ‘Mini-Budget’, passed in the National Assembly yesterday, in the midst of an opposition walk-out protesting the Bill’s contents.

The Bill has wholly removed the ban on Non-Filers; the initial proposal allowed Non-Filers access to the market for cars with a cylinder capacity of less than 1300cc.

All three auto players (PSMC, INDU and HCAR) will be the beneficiary of this reversal in policy, as they will now be able to clear their build-up of stock.

March 7, 2019
Non-filers allowed locally assembled motor vehicle of any engine capacity

ISLAMABAD: The federal government has allowed non-filers of income tax returns to purchase of locally assembled motor vehicles of any engine capacity.
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March 6, 2019
Only non-filers to pay withholding tax on cash, non-cash banking transactions

Pakistan has decided that only non-filers of income tax returns will pay withholding tax on cash and non-cash banking transactions.
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January 24, 2019
Non-filers allowed motor vehicle purchase on enhanced tax rates

Non-filers of income tax return have been allowed to purchase motor vehicle on enhanced tax rates, according to a federal minister of Pakistan.
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January 24, 2019
Curbs on non-filers trap tax authorities

ISLAMABAD: The tax authorities are facing challenging revenue collection after imposing curbs on non-filers in the budget 2018-2019.
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January 20, 2019