FBR issues withholding tax rates on commercial, industrial electricity consumers

KARACHI: Federal Board of Revenue (FBR) has issued withholding tax rates to be collected from electricity consumers of commercial and industrial.

According to Withholding Tax Card for tax year 2020 applicable from July 01, 2019, the power utility preparing electricity bills shall collect withholding tax under Section 235 of Income Tax Ordinance, 2001 from commercial and industrial consumers along with payment of electricity consumption on charges.

The FBR issued following withholding tax rates on electricity consumption by commercial and industrial consumers”

If monthly bill does not exceeds Rs400 the rate of withholding tax shall be zero.

Exceeds Rs. 400 but does not exceed Rs. 600 the rate of withholding tax shall be Rs80.

Exceeds Rs. 600 but does not exceed Rs. 800 the rate of withholding tax shall be Rs100.

Exceeds Rs. 800 but does not exceed Rs. 1000 the rate of withholding tax shall be Rs160.

Exceeds Rs. 1000 but does not exceed Rs. 1500 the rate of withholding tax shall be Rs300.

Exceeds Rs. 1500 but does not exceed Rs. 3000 the rate of withholding tax shall be Rs350.

Exceeds Rs. 3000 but does not exceed Rs. 4,500 the rate of withholding tax shall be Rs450.

Exceeds Rs. 4500 but does not exceed Rs. 6000 the rate of withholding tax shall be Rs500.

Exceeds Rs. 6000 but does not exceed Rs. 10000 the rate of withholding tax shall be Rs650.

Exceeds Rs. 10000 but does not exceed Rs. 15000 the rate of withholding tax shall be Rs1000.

Exceeds Rs. 15000 but does not exceed Rs. 20000 the rate of withholding tax shall be Rs1500.

Exceeds Rs20000:

(i) The tax shall be at the rate of 12 percent for commercial consumers;

(ii) The tax shall be at the rate of 5 percent for industrial consumers.

The FBR said that the tax shall:

(i) Adjustable In case of company.

(ii) In case of other than company tax collected on Rs, 360000 amount of annual bill will be minimum tax.

(iii) in case other than company tax collected on amount over and above Rs 30000/- of monthly bill will be adjustable

(i) Minimum Tax for CNG Stations.

The FBR said that power utilities are required to collect adjustable withholding tax under Section 235A from domestic consumers along with payment of electricity consumption on charges.

The tax shall be collected at 7.5 percent if the amount of monthly bill is Rs75,000 ore more. However, tax shall not be collected if the amount of monthly bill is less than Rs75,000.

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