ISLAMABAD: The Federal Board of Revenue (FBR) has said that withholding tax rates for industrial and commercial consumers have been revised.
Withholding tax on domestic electricity consumption was collected at the flat rate of 7.5% if the monthly domestic electricity bill exceeded Rs. 75,000.
In order to promote documentation and broadening of tax base this withholding tax has been:
— done away with in case of persons appearing on Active Taxpayer’s List irrespective of amount of bill.
— threshold for collection of tax has been reduced from Rs. 75,000 to Rs. 25,000.
The new rate of collection of tax from commercial and industrial consumers from gross amount of bills shall be as set out in the following Table, namely :-
TABLE
| S.No | Gross amount of Bill | Tax |
| 1 | upto Rs. 500 | Rs. 0 |
| 2 | exceeds Rs. 500 but does not exceed Rs. 20,000 | 10% of the amount |
| 3 | exceeds Rs.20,000 | Rs. 1950 plus 12% of the amount exceeding Rs. 20,000 for commercial consumers Rs. 1950 plus 5% of the amount exceeding Rs. 20,000 for industrial consumers |
Taxpayer’s are entitled for exemption certificate under section 235 on discharge of their advance tax liability. However the language of law was constructed to the effect that advance tax liability for the whole tax year was required to be discharged to obtain this certificate. Now this ambiguity has been resolved by making necessary changes in sub section (3) of section 235 of the Ordinance. Now the taxpayer can obtain certificate for a quarter by discharging their advance tax liability for the quarter.