Federal Board of Revenue-Archived/OLD News Room

View FBR Current News | View Media Coverage

 
April 30, 2010 Govt allows import of cars to disabled persons

The government has allowed import of custom-duty free new car of engine capacity not exceeding 1350cc by a Pakistani disabled national for personal use, says a press release issued by FBR.

The decision announced vide Customs Notification No. SRO 277(1)2010 dated 27th April, 2010, of the Revenue Division, has been taken in pursuance of a government decision announced vide Notification No 16(1)/2006 – Import II, dated the 28th September, 2009, issued by the Ministry of Commerce, to allow import of duty free cars for personal use of disabled persons, to overcome the disability, subject to fulfillment of criteria and conditions laid down in the policy.

According to the conditions, at the time of import of car the disabled person must have import authorization certificate issued by the Ministry of Commerce in his favour. Moreover, only one car shall be allowed to be imported by a disabled person, and the car shall not be sold or otherwise transferred to any person before the expiry of five years from the date of its arrival in Pakistan.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407

 

April 23, 2010 Senior citizens can avail 50pc tax rebate in payable income, says FBR

Senior citizens over 60 years of age are entitled to claim 50 per cent rebate in the payment of tax outstanding against them.

In a press statement, the FBR has clarified that this facility is available to all senior citizens under section 53(1)c and clause 1A of Part-III of the Second Schedule of the Income Tax Ordinance, 2001 which clearly provides that “where the taxable income, in a tax year, of a taxpayer aged 60 years or more on the first day of that tax year does not exceed seven hundred fifty thousand rupees (Rs. 750,000/-), his tax liability on such income shall be reduced by 50%”.

The facility is also available in case a tax has already been paid at any stage by senior citizens who can claim the refund while filing their annual tax returns. For further guidance and facilitation, the taxpayers can visit FBR’s website or contact helpline staff on 051-111-227-227 and 0800-00227 during the working hours.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


March 29, 2010 VAT debate not to risk IMF’s stand-by arrangement, says FBR


Federal Board of Revenue (FBR) has made it clear that the differences on Value Added Tax (VAT) are not likely to jeopardize the IMF’s stand-by arrangements.

The spokesman of FBR on Monday pointed out that there have been reports recently in the media trying to link the debate on VAT to the IMF’s stand-by arrangements but there is no truth whatsoever in such speculative news items which appear to be stemming from an inadequate understanding of VAT’s introduction in the country.

The spokesman said the existing sales tax in Pakistan is fundamentally based upon VAT principles. However, unnecessary tax concessions and exemptions have distorted the overall VAT character of the sales tax system and seriously damaged the tax base. The new VAT laws have already been tabled in the National and Provincial Assemblies within the existing constitutional framework and the respective Standing Committees are considering the VAT bills before their enactment. Legislation of VAT is therefore progressing as scheduled.

The spokesman also noted that the FBR had already launched a nationwide campaign to brief all the Chambers of Commerce & Industry, including FPCC&I about the forthcoming VAT system. The existing sales tax system has 12 different tax rates ranging from 16 per cent to 25 per cent, while the proposed VAT scheme will introduce a single rate at 15 per cent. Similarly, registration threshold has also been increased from Rs 5 million to Rs 7.5 million per annum turnover.

The spokesman said the VAT regime will extend the scope of tax to hitherto untaxed sectors, especially services. Withdrawal of unnecessary exemptions on commodity sector and expansion of tax scope on services will broaden the tax base. Broad-based VAT on goods and services will not only progressively bring additional revenues to the exchequer but will also accelerate economic documentation, eventually leading to improvements in other tax regimes, especially income tax. The VAT regime will also increase the tax-to-GDP besides leading to economic equity in the country.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


March 10, 2010 25pc duty levied on export of waste of copper, aluminum

The federal government has imposed regulatory duty at the rate of 25 per cent on export of waste and scrap of copper and aluminum, says an SRO issued by Federal Board of Revenue (FBR).
According to the SRO-(1)2010, a regulatory duty at the rate of 25 per cent has been imposed ad valorem on export of waste and scrap of copper and aluminum as well as on bars, rods, ingots, slabs, and billets made thereof from 13th March, 2010 to 30th June, 2010 on the basis of ECC’s decision. The position shall be reviewed at the time of budget formulation for financial year 2010-11.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 25, 2010 LTU Karachi and Bankers discuss options for issuing Excise Invoices to registered clients
 

Under the instructions of Chief Commissioner, Large Taxpayer Unit, Karachi (LTU) Ms. Yasmin Saud, a meeting was held with the representatives of banks, financial institutions and corporate taxpayers on 9th March, 2010 in order to discuss issues arising in connection with the levy of 16% Federal Excise Duty (FED) on services provided by banking and non-banking financial companies. Mr. Nasir Butt, Commissioner (Audit-II), LTU welcomed the participants.

From 1st July, 2009, the rate of FED on banking services has been enhanced from 10% to 16%, and it was converted to VAT mode. Thus, banks and financial institutions were allowed to adjust the FED and Sales Tax paid on their purchases of goods or services against their output tax liabilities. Likewise, registered clients of banks and financial companies also became entitled to adjust the amount of FED paid to banks or financial companies. However, to make such adjustment, registered persons need invoices issued by the banking companies, which is causing some problems. Presently banks are only issuing certificates on the specific request of their corporate clients, and these are not legally tax invoices. To bring this practice in line with the legal requirement, suggestions were taken from the stakeholders.

During the meeting, the representatives were encouraged to express their views and inform about the practical problems related to issuance of invoices. Officers of LTU discussed various options which could facilitate the taxpayers, and noted the proposals given by the participants. On the basis of this feedback, LTU will compile a report and make recommendations to FBR for formulating a uniform procedure for the issuance of invoices by banks and non-banking financial institutions for the facilitation of taxpayers.
 

   

 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 23, 2010 Large Taxpayers Unit, Karachi hosts an Orientation Seminar for Port and Terminal Operators
 

In order to educate and facilitate the Port and Terminal Operators about the recent levy of Federal Excise Duty in VAT mode on their services, an orientation seminar was conducted by the Large Taxpayer Unit, Karachi on Tuesday, 23rd February, 2010.

Organized by the Taxpayer Facilitation Division of LTU, the seminar aimed at providing information and assistance to the port and terminal operators about payment of 16% Federal Excise Duty in VAT mode on services rendered by them at or near any port area. In the Federal Budget 2009-2010, the Government levied FED on services provided by port and terminal operators at the rate of sixteen percent. However, it was found that many such units who were engaged in providing services like piloting and berthing of vessels, loading and unloading of cargo, storage, delivery, etc. at or near the port areas were not aware of the levy of FED on their services.

The seminar was attended by representatives of Karachi Port Trust as well as many prominent terminal operators. Addressing the audience the Chief Commissioner LTU, Mrs. Yasmin Saud emphasized on the need to improve compliance level of the taxpayers through education and awareness.

During the panel discussion, Mr. Ashfaq Tunio, Additional Commissioner answered wide-ranging questions raised by the audience on the scope of FED on services, payment structure and philosophy behind introducing FED in VAT mode. Mr. Mardan Abbasi from Karachi Port Trust provided some support information regarding stevedores and terminal operators.

During presentation, Ms.Farah Farooq, Deputy Commissioner TFD (Taxpayer Facilitation Division) covered the legal provisions and view point of tax authorities on this new levy.

The participants appreciated the initiative by LTU, Karachi which was aimed at better awareness among taxpayers, encouraging voluntary compliance and removing any practical difficulties being faced by them.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


March 3, 2010 No closing down of PaCCS, says FBR


Federal Board of Revenue (FBR) has vowed to achieve 100 per cent automation of its different organs, including customs, income tax and sales tax etc.

In a statement, the FBR spokesman has maintained that automation of FBR and its key organs like customs, income tax and sales tax, is in good progress and FBR is fully committed to achieving 100 per cent automation of work processes in key wings and departments.

However in some recent media reports it has been wrongly reported that Pakistan Customs Computerised System (PaCCS) is being closed down. These reports have mixed up PaCCS with the M/s. Agility which is a company providing software to run the system for PaCCS. It has been decided following the input received from the system audit of the software and some other related issues that the automation of Customs may not be rolled out through M/s. Agility and FBR will come up with a substitute for PaCCS for providing automated services and rolling it out to all the customs stations in the country.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 24, 2010 Germany to help FBR is tax reforms


Germany has pledged to help Pakistan in successfully implementing the reforms process currently under way in Federal Board of Revenue (FBR).

“Germany considers Pakistan a valued partner in business and trade and it would be happy to provide any technical support to Pakistan in modernising its tax administration,” said Dr. Birger Nerre during a meeting with Ms Riffat Shah Qazi, Member Facilitation & Taxpayers Education FBR. Dr Birger Nerre who heads the Public Finance, Administration Reforms and Anti-Corruption wing of the German Technical Cooperation is leading a four-member delegation on a visit to Pakistan to explore avenues for enhancing mutual cooperation and exchange technical expertise between the two countries.

Ms. Qazi briefed the visiting delegates on the various steps and measures taken by the FATE Wing to broaden tax base, raise tax-to-GDP ratio, and to promote a taxpayer-friendly image of FBR. She also explained the nature of work executed by FATE Wing with regard to organisation of seminars, workshops and promotion of friendly relations with the taxpayers and other stakeholders, including the print and electronic media.

Dr. Birger Nerre appreciated the reforms process being pursued by FBR with a view to modernising the tax machinery and introducing VAT from the next financial year. He said Germany was keen to work with Pakistan in different areas of the economy, including taxation, and their ongoing visit to Pakistan was aimed at working out modalities of a framework that would allow the two countries to forge ahead in their bilateral trade and economic relations. Senior FBR officials, including FATE Chief Sajjad Ahmad Khan, Secretary Dr Akthar Hussain and others also attended the meeting.
 

 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 20, 2010 No additional burden on existing taxpayers, says FBR

Federal Board of Revenue (FBR) has vowed to broaden the tax base without putting additional burden on the existing taxpayers.

This was stated by Mr. Shahid Anwar Khan, Chief Commissioner Inland Revenue, RTO Rawalpindi, while chairing the 8th meeting of Regional Tax Advisory Committee at the RTO.

The meeting was attended by representatives of Rawalpindi Chamber of Commerce & Industry (RCC&I), Rawalpindi Islamabad Tax Bar Association (RITBA) and a number of Trade Bodies and Associations from Rawalpindi as well as from Mufassil Areas (Jhelum, Chakwal, and Gujar Khan).

Mr. Anwar said the government wanted to take on broad the traders and business community before launching an exercise for broadening of tax base. The exercise to bring more people in the tax net would be facilitated by the FBR through distribution of a simple form amongst the traders of new commercial areas which have emerged during the last few years.

The form will require individuals to provide information about the name and nature of business, name of proprietor, CNIC number along with a copy, NTN (if existing taxpayer), along with proof of filing of return for tax year 2009. No further information will be obtained from these taxpayers.

The traders and businessmen attending the meeting appreciated the efforts of the Inland Revenue Department with regard to identification of new taxpayers in specified areas of Rawalpindi and Mufassil and to bring them into tax net, so that the tax burden was distributed amongst the existing taxpayers and the new ones. They also offered valuable suggestions to make this exercise successful.

   

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 20, 2010 Afghanistan evinces interest in Pak tax reforms

Afghanistan has shown keen interest in the reforms process under way in Federal Board of Revenue (FBR) with a view to using the reforms as a model to revamp its own taxation system.
The interest was shown by Dr Ahmad Shah Zamanzai, Director General of Afghanistan Revenue Department, who led a delegation of senior Afghan tax officials during a visit to the Regional Tax Office (RTO) Lahore.

The visiting delegates said the Pakistani experience of tax reforms was interesting enough for them to look at it and see how it could be helpful in undertaking similar reforms in their country.
During the visit, Khawaja Shaukat Ali, Chief Commissioner Inland Revenue Regional Tax Office Lahore, briefed the delegation about the reform process and the milestones achieved in this regard. He also explained the working of Regional Tax Office on functional basis with reference to Audit, Enforcement with support functions of Legal, Tax Facilitation & Information processing. The steps taken by the Federal Board of Revenue and Regional Tax Office to facilitate the taxpayer through setting-up of facilitation desk, online facilities available, and establishment of kiosks in commercial areas were also explained. The delegates showed keen interest in the achievements of Regional Tax Office, Lahore, asking pertinent questions about the Pakistani tax experience and how it could be replicated in Afghanistan.

Later on the delegation visited various floors of Tax House and viewed ongoing work. The delegation also visited data entry centre (DEC), record room and saw demonstration by the officer in this regard. The delegates appreciated the facilities of e-filing, NTN, STRN, Refund Receipt Counters and Reception Counters available for the taxpayers and visitors.
 

 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 03, 2010 Riffat Shaheen appointed new Member FATE

Ms. Riffat Shaheen Qazi, a BS-21 officer, has assumed charge of the office of Member Facilitation and Taxpayer Education (FATE) in the FBR Headquarters.

Ms. Qazi, a senior officer of Income Tax Group from the 7th Common, has already served in various key positions serving across the country in her illustrious career spanning over 31 years. Her last posting was in the Regional Tax Office Rawalpindi where she led a series of tax recovery drives as the Chief Commissioner Inland Revenue Service.

Ms. Qazi brings with her a rich professional and academic experience. She holds a Master’s degree and an MPhil in Economics from the University of Peshawar. Later she completed Masters in Business Administration from John F. Kennedy University USA. Her last academic pursuit was at the prestigious Harvard University, where she attended an extensive Senior Executive Management training course.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 03, 2010 FBR chief urges greater effort for revenue collection

Federal Board of Revenue (FBR) Chairman Mr. Sohail Ahmad has called for concerted efforts to improve the collection of revenue.

“Meeting the revenue collection target is a huge responsibility and we must pool and use all our resources to meet this challenge,” he said in his address to a seminar organised by the HRM Wing of the FBR on ‘IP framework for effective business processes’ here in the capital.

The Chairman emphasized the importance of IP and its contribution towards the performance of various FBR wings such as audit and enforcement. He announced similar seminars would be held in the coming days to gather feedback and break the disconnect between the Headquarters and the Field Formations.

The seminar attended by the concerned FBR Members, all Chief Commissioners from the Field Formations as well as Commissioners IP, DG (IMS), CEO (PRAL) and GM (PRAL) discussed a broad range of issues related with IP to identify a clear roadmap for better cross verification of information and broadening of tax base in the wake of functional and structural integration of domestic taxes within the FBR.

CEO PRAL, DG (IMS) and Member Sales Tax and Federal Excise also briefed the participants about the ongoing activities in the field and the actions required to be performed. The participants proposed removal of dormant NTNs, integration of all applications of Sales Tax and Income Tax, more training in Mahasil, STARR & their different modules as well as specific software
relevant to job descriptions.

At the end, the DG (HRM) thanked the participants for their valuable input and suggestions and assured that these suggestions would be sent to the concerned authorities for devising the future strategy.

 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


January 23, 2010 No hike in WHT on commercial power bills, says FBR

Federal Board of Revenue (FBR) Saturday denied the government was considering increasing Withholding Tax on electricity bills of commercial consumers by 100 per cent as reported in a section of the press.

A spokesman of the FBR has clarified that the government after looking at the revenue collection performance of Federal Board of Revenue during the second quarter (Oct-Dec 2009) has decided not to take any additional taxation measure.

 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407

   
 
   

January 13, 2010 Adjudication of ST evasion cases under amended law intact: FBR

Federal Board of Revenue (FBR) Wednesday said the status of cases involving Sales Tax evasion that are pending for adjudication, had not been affected by the omission of section 45 of the Sales Tax Act, 1990, following the promulgation of Finance (Amendment) Ordinance, 2009, as claimed in the reports appearing in a section of the press in recent days.

In an official statement, the FBR spokesman has dispelled the wrong impression regarding the matters pertaining to section 45 of the Sales Tax Act, 1990, to the effect that section 45 provides no legal sanction for the process of adjudication. This section which is neither charging nor adjudicating in scope, only prescribes pecuniary limits for adjudication by various authorities. Orders of adjudication/assessment are not made under section 45 but under section 11 or section 36 of the Sales Tax Act, 1990.

The spokesman recalled that the Finance (Amendment) Ordinance, 2009, in an attempt to harmonize the domestic tax laws, abolished the separate tier of adjudicating authorities. Through insertion of sub-section 4(A) in section 25, the officer conducting audit, has been authorized to determine the tax liability by passing an order under section 11 or 36 of the Sales Tax Act, 1990.

Press reports had pointed out about pending adjudication proceedings, which had not been saved whereas the fact is that saving of pending adjudication proceedings was not required in view of section 6 of the General Clauses Act, 1897. Section 6 relates to consequences of repeal of Central Acts or Regulations and is equally applicable to amendments in Acts and Regulations.


Similarly, the process of adjudication by a separate authority was consciously discontinued for future cases. At present, final orders determining the tax liability in cases of registered persons are to be made by the same authority in harmony with the procedure under the Income Tax Ordinance, 2001. In the pending cases, adjudication will be continued and finalized under the un-amended provisions.

Moreover, reference to Additional Collector, Deputy Collector or Assistant Collector in the omitted Section 45 would mean reference to Additional Commissioner, Deputy Commissioner and Assistant Commissioner Inland Revenue, etc, as given in Section 72A of the Sales Tax Act, 1990, inserted through Finance (Amendment) Ordinance, 2009.

The spokesman further maintained that issuance of fresh show cause notices is not required and pending proceedings can be continued and finalized. Even otherwise, fresh show cause notices, if required, can be issued within the periphery of limitation of five years prescribed under section 11 and five and three years respectively under sub-section (1) and (2) of section 36. In case, where there is time limit for adjudication, the same can be extended by FBR as provided under section 74 of the Sales Act, 1990.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407
 




 
 

December 30, 2009 FBR extends date for filing of IT returns up to Jan 25, 2010

Federal Board of Revenue (FBR) has extended the date for filing, e-filing of income tax returns and statements up to January 25, 2010 to facilitate taxpayers in view of the prevailing situation in the country, says an official statement released Wednesday.

The extended time period shall be available only for those corporate cases where due tax to be paid is deposited by December 31, 2009 while the corresponding return may be filed by the extended date. Income tax returns/statements in cases of non-filers/short-filers individuals/association of persons (AOPs) may also be filed by depositing the tax payable along with the returns/statements by January 25, 2010.

According to the statement, penalties, additional tax and prosecution shall, therefore, not be attracted in cases where income tax returns/statements are filed/e-filed accordingly by the extended date 1.e., January 25, 2010, if the conditions mentioned above are fulfilled.

Relevant branches of State Bank of Pakistan and National Bank of Pakistan will remain open to receive tax payments up to 08:00pm, and all Inland Revenue Regional Tax Offices and Large Taxpayers Units will remain open till 9:00pm on December 31, 2009.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


December 10, 2009 Request for media coverage

Federal Board of Revenue (FBR) will conduct *Computer-based random balloting to select units/persons for tax audit* at an open ceremony to be held at FBR House tomorrow (Friday). The schedule of the event is as under.

Venue: Lobby, 2nd Floor, FBR House, Islamabad

Date: December 11, 2009 (Friday)

Time: 2:45pm

2. You are requested to depute a team of reporter/camera man for the coverage of the said event at the given venue, date and time.**
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


December 3, 2009 FBR denies reported corruption in Customs department
 

A spokesman of the Federal Board of Revenue has denied the contents of a news item captioned “we shall make an example of 300 big tax evaders: FBR” and attributing to Chairman FBR a reference to corruption of certain magnitude in the revenue collection machinery, particularly in the Customs department.

The spokesperson has clarified that the stated perception is based on some misunderstanding and has been reported in the press out of context. In fact, customs revenue collection of Rs. 56.7 billion is ahead of the target of Rs. 56.1 billion for first five months of the financial year. In the press conference, it was highlighted that the revenue performance of FBR, particularly of Customs, can further be improved through the ongoing reform process by effectively plugging the revenue leakages. Therefore the said impression of the magnitude of corruption in Customs created through the said news report is ill founded and is incorrect.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


October 23, 2009 Excise duty no cause of less cultivation of beet crop

A spokesman of the Federal Board of Revenue (FBR) has clarified press reports published in a section of the press claiming the cultivation of beet crop in NWFP has been given up by farmers due to excess taxes.

The spokesman has described as misleading and irrelevant claims made by Anjuman-e-Kashtakaran NWFP officer-bearers who have been reported by the press as having complained that the cultivation of the beet crop in NWFP has creased due to imposition of central excise duty in 1995 and other levies in recent times.

The spokesman has maintained that the issue pertaining to year 1995 has no relevance after a lapse of 14 years in the last quarter of 2009 as currently the sugar made from cane or beet crop is chargeable to 8 per cent of sales tax and 1 per cent special excise duty. Hence, the reports blaming the present sugar crisis on the levy of excise duty on beet sugar in 1995 are
without logic and merit.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


October 8, 2009 Pakistan, Morocco ink treaty to avoid double taxation

Pakistan and Morocco have concluded a treaty for the avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income of residents of the two countries.

The two sides exchanged Thursday an instrument of ratification at a ceremony held at the FBR House in the presence of FBR Chairman Mr. Sohail Ahmad who led the Pakistan side and Moroccan Ambassador to Pakistan, Mr. Mohammed Rida El-Fassi who represented the Kingdom of Morocco. FBR's Member Direct Policy Mr. Asrar Raouf and Chief International Taxes, Mr Saeedur Rahman were also present.

The negotiations for conclusion of the Convention for the Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income between the Islamic Republic of Pakistan and the Kingdom of Morocco held a couple of years ago before the Convention was signed in Rabat, Morocco on May 18, 2006.

Highlighting the salient features of the convention, Mr. Sohail Ahmad, Chairman FBR, said the treaty had done away with the double taxation of income between the two countries to promote bilateral trade and commerce. Under the convention, principles had also been laid down for taxation of all sources of income as well as residential status of individuals and corporate
entities. Funds received by the students for the purpose of education have been exempted from tax under the convention which also provides comprehensively for cooperation in all important areas of international taxation, including exchange of information.

The FBR Chairman believed the new arrangement would not only provide safeguards against double taxation but it would also lay the ground for promoting economic cooperation and furthering mutual trade and investment by ensuring certainty of tax treatment.

Speaking on the occasion, Moroccan Ambassador Mr. Mohammed Rida El-Fassi appreciated the warm welcome and expressed the hope “the convention would serve as a significant step in enhancing economic ties between the two brotherly countries”.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


October 5, 2009 FBR nets Rs 259 billion revenues in first quarter

Federal Board of Revenue (FBR) collected Rs 259.24 billion of revenues during the first quarter of the current fiscal year, according to provisional figures released by FBR on Monday.
According to the figures, the FBR has collected Rs 98.37 billion during the month of September 2009. Aggregate collection during the first quarter of the ongoing fiscal year thus works out to Rs 259.24 billion. The final revenue collection figures for the month of September 2009 are likely to increase further following the receipt of taxes, including taxes deducted at source, collected from different parts of the country.
The break-up of the tax collection figures for the month of September 2009 is attached for further details.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


October 5, 2009 Asrar Raouf appointed FBR’s official spokesman
Mr. Israr Raouf, Member (Direct Taxes Policy) has been appointed as official spokesman of the Federal Board of Revenue (FBR), according to a press release issued Monday.
Mr Raouf, a BS-21 officer of the Income Tax Group, has previously served at various key positions with DG Regional Tax Office Karachi as being his last assignment.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


September 30, 2009 Extension in Date for Filing of Income Tax Returns

Mujeeb-ur-Rehman Talpur
Second Secretary (PR)
FBR


September 19, 2009 FBR sets up tax facilitation centres across country

Federal Board of Revenue (FBR) has set up facilitation desks/kiosks all across Pakistan to help taxpayers filing their income tax returns before the September 30 deadline.
The kiosks and tax facilitation centres (TFCs) have been established in all major urban centres to provide technical support to taxpayers. A formal ceremony to mark the opening of the TFCs will be held in Lahore tomorrow (Saturday) where FBR Chairman Mr. Sohail Ahmad will speak as chief guest at the inauguration of a facilitation desk/kiosk in Liberty area.
The board has further clarified that e-filing mode for the submission of income tax returns is required only for individuals and companies with whose declared income is Rs 500,000 or more per annum and not for ordinary traders and individuals whose income falls below the specific threshold.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


September 10, 2009 FBR extends time for e-filing of annual statement
Federal Board of Revenue (FBR) has extended the last date until September 15, 2009 for e-filing of the annual statements, says a press statement issued on Thursday.

The decision to extend the last date for electronic submission of annual statements has been taken following various representations received from the business community, concludes the statement.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


September 3, 2009 Tarin urges self-reliance to achieve economic stability.


Finance Minister Shaukat Tarin Thursday said self-reliance was the only way forward for Pakistan to achieve economic stability and lessen dependence on revenue streams flowing in from donor agencies.

“As long as these revenue streams flow, things work well but once these streams go away, problems re-surface and economic independence becomes a distant dream,” he said in a keynote address to a two-day ‘Conference on Value Added Tax (VAT)’ that started in the capital here under the auspices of Federal Board of Revenue (FBR).

The minister said Pakistan heavily relied on taxes as a major source for government revenues required for socio-economic uplift of the people. Optimum revenues are achieved when an efficient taxation system is in place. Our Government’s vision and strategy of a better Pakistan also rests on a taxation régime which is based on equity and fairness, convenience of payment, economy in collection, and simplicity of procedures, he added.

He said reducing poverty through generating additional revenues is an important step towards achieving our government’s vision and that can only be achieved through an efficient taxation system which conforms to the best international practices in revenue collection.

Shaukat Tarin said these best practices were being adopted by countries all over the world and like others Pakistan had also set about modernising its taxation structure through the Tax Administrative Reforms Program (TARP) aimed at achieving greater efficiency and productivity in the tax collecting business processes and tapping new tax resources.

He admitted there were challenges in the way of generating additional indigenous revenues and exercise of discretionary powers by the government, lack of professionalism due to an inadequate capacity building and existence of certain exemptions in our tax regime were issues which needed to be addressed before the introduction of Value Added Tax.

Tarin said the tax managers alone could not do all this and “a lot depends on the policy, planning, vision and commitment of the political and economic managers”. “It is therefore a common responsibility of all the stakeholders to contribute towards achieving an efficient taxation system which can generate additional revenues for the country,” he added.

He also called for collective efforts to achieve a broader and larger goal of better standards of living for the people through better tax collection. This in turn requires increase in tax base by incorporating maximum categories of services into the tax net. While our tax base includes a wide range of goods, services sector, which is a major source of revenue around the world, is largely out of the tax net and it is time we revisited our exemptions, zero-rated items, rate variations and major sources of irritants to business, he added.

The finance minister said Pakistan could also draw on the experiences of other countries for developing a viable model best suited to our economy. He said the Value Added Tax could be considered as an effective tool for proper documentation of economy, widening of tax base and equitable taxation mechanism.

Later talking to media men, Shaukat Tarin highlighted the importance of value addition for taxation purposes on the retail stage as widening of taxation base. At the retail stage it is basically the issue of understanding and tapping the whole supply chain of goods and services. However, enforcement of any such tax on such a stage cannot be adequately done if the tax collecting machinery is not properly aware of the facts and figures regarding the different social segments, documentation of small to medium businesses, their supply chains and financial capacity of the retailers themselves. All this needs to be thoroughly researched, properly documented and comprehensively digitized by the tax machinery.

To another question, he underscored the VAT service delivery and its impact on the lives of our taxpaying community which is the backbone of our economy. FBR should keep in mind that VAT in today’s world is considered as a powerful tool in harnessing funds in domestic markets. These funds can then be used by the developing countries like Pakistan to meet the challenges like increasing mass education, poverty eradication and provision of socio-physical infrastructure.

The minister cited the example of Sri Lanka which at a 15 per cent VAT had been able to increase its tax-to-GDP ratio by seven per cent and if Pakistan could increase its tax-to-GDP ratio by four per cent through the implementation of VAT, it would be able to raise an additional Rs 600 billion, taking us close to bridging the Rs 722 billion fiscal deficit.

Earlier FBR Chairman Mr Sohail Ahmad in his address to the inaugural technical session of the conference highlighted the steps taken by FBR for generating more revenue through massive reforms, re-structuring and business process re-engineering which he said could also serve in the implementation of VAT from July 2010.

He said the government believed the impact of taxes generated through VAT would be significant in covering all those sectors which earlier enjoyed exemptions in one way or the other. He welcomed the participants of the conference which he hoped would be able to come up with a way forward for the implementation of value added tax in an incentive-based, transparent and harassment-free environment.

 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


September 1, 2009 FBR launches project for automation of inventory, financial modules

Federal Board of Revenue (FBR) has launched a project for the automation of various work  processes involving financial and material management in the organisation.

Under the project expected to be completed within 15 months, various work processes, including budget management system, accounts expenditure management system and material management, would be configured and customized to meet the FBR requirements. The system after its completion at the FBR Headquarters would also be replicated in the field offices and
formations.

Speaking at a ceremony to mark the launch of the project at the FBR House Monday, FBR Chairman Sohail Ahmad hoped the project would enable FBR to execute real-time internal financial controls and ensure transparency, efficiency and enhanced decision support.

The system under which supported procurements will have electronic linkages with Ministry of Finance and AGPR Office will also go a long way in extending FBR’s visibility beyond the bounds of the organization through an interface with PIFRA system and future expansion. Besides, it will ensure end-to-end automated business processes, real-time integration, flexible, real-time reporting, interfacing and best practices that are the hallmark of efficient organisations.

The kick-off ceremony organised at the FBR Headquarters Islamabad was also attended by senior FBR Members and officials. Later, FBR Chairman Mr Sohail Ahmad and board members visited the newly-developed SAP Competency Center and appreciated the modern setup.

The project is coordinated by Sheikh Hafeez and Mr Shahbaz from Siemens while the FBR side is represented by Ch Muhammad Azam, Member (Admn), Mr Abdul Jaleel, Chief (Admn)/ Project Director(SAP), Mr Bakhtiar Muhammad, Director (Coord-SAP), Mr Sarwar Jang, Director SAP, Mr Ali Raza, Director MM and Mr M. Sauood ur Rauf, Director FI.
 

 
 
 
 
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 31, 2009 FBR preparing organizational framework for proposed IRS

Federal Board of Revenue (FBR) has started preparing an organizational framework for the proposed Inland Revenue Service (IRS) and the Customs group to be set up as part of the reforms process under way in the board.

The task for preparation of the organogram for the proposed service to be established on functional lines has been handed to the newly-furbished Human Resource Source Wing which has already put in place a host of measures aimed at accelerating the pace of reforms process with a focus on re-organisation and capacity building of the human resource.

As part of these measures, a special presentation was given to Finance Minister Mr. Shaukat Tareen who visited the FBR Headquarters recently to attend the DGs Conference. The minister appreciated the work done so far and called for its early completion to achieve the desired targets of the reforms programme.

The new service to be set up through an Act of the Parliament will replace the existing set-up, paving the way for a fully integrated tax administration of sales tax, excise and income tax in line with recommendations and aspirations of the stakeholders.

The renewed focus on the human resource management is also reflected in the appointment of a director general to head the all-important HRM Wing which was previously overseen by a chief. The move has resulted in various measures to reform and restructure the existing work processes with a view to enhancing the quality of skill sets and creating a performance-based reward system.

Some of the measures that have been taken in recent days include constitution of various teams to oversee progress of work on issues related to integration, preparation of new job descriptions, new performance evaluation reports, new performance-based bonus/reward scheme and the market-based salaries for which a survey is already under way to determine the extent of wages on offer in the private and public sector organisations.

Similarly, the HRM Wing has also started conducting various orientation/training workshops for the officers of both Income Tax and Customs & Excise groups. Such workshops are already under way at the Directorates of Training in Lahore, Karachi and Islamabad respectively.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407

 

August 31, 2009 Packing list, invoices made necessary for customs clearance of imported cargo

Federal Board of Revenue (FBR) has made it binding on all imported cargo entered in the customs area for clearance to be accompanied by a copy of packing list and invoice.

Earlier, Federal Board of Revenue had temporarily relaxed the provision added vide SRO No.198(I)/2005, dated 28.02.2005 to the Customs Rules, 2001, whereby all imported cargo entered in the customs area for clearance was to be accompanied with a copy of packing list and invoice. The relaxation had been granted through a board letter No.3(1)L&P/05 dated 20.05.2006. However, the issue has been re-examined recently in consultation with the Chamber of Commerce & Industry and Clearing Agents Associations and it has been decided to withdraw the above said letter of the board.

As a result, provision of Sub-chapter-I of Chapter XVIII of Customs Rules, 2001 shall become operational for all categories of goods except the old and used motor vehicles imported under various schemes; iron, steel and aluminum scrap; unpack bulk cargo like coal and raw cotton; goods imported under DTRE scheme; imports under section 22 of the Customs Act, 1969; old and used machinery; bulk imports of petrochemical; and defence cargo. The provision of sub-chapter-I of Chapter XVIII shall apply w.e.f. 05.10.2009. The importers have been advised to make arrangements with their foreign exporters to make sure that invoice and packing list are kept inside the containers of import.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 27, 2009 FBR forms body to address human resource issues

Federal Board of Revenue (FBR) has constituted a nine-member team of officials to oversee progress on the reforms programme with a focus on integration of domestic tax administration and preparation of a revenue-specific performance-appraisal system and job descriptions.

The reform project team headed by the Director General Human Resource Management Wing FBR and assisted by Chief (Management) comprises senior officers drawn from both Income Tax and Customs & Excise groups. Besides serving as a focal point driving an organised and focus effort to address the HR issues, the team will also assist and advise the FBR on the ongoing tax administration reforms strategy. The officers included in the team are Abdul Hameed Memon (BS-19), Ayesha Bashir Wani (BS-18) and Saeed Akram (BS-18) from Customs & Excise Group and Ayesha Khalid (BS-19), Bashirullah Khan (BS-19), Riaz Hussain Shah (BS-18), Masood Ahmed (BS-18), Reema Masood (BS-18) and Dr Irfan Abbas Shah (BS-18) from Income Tax Group. Besides this team, Shahid Zaman (BS-19) of Income Tax Group and Ali Abbas Gardezi (BS-18) of Customs & Excise Group have also been associated with the team to work as assigned to them by the team leader.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 25, 2009 FBR launches portal for e-filing of IT returns
Federal Board of Revenue (FBR) has started receiving income tax returns through the e-filing process accessible by taxpayers at e-FBR portal.

A press statement issued Tuesday by the FBR says that e-filing software has been finalized and implemented at e-FBR portal at ( https://e.fbr.gov.pk ) since August 19, 2009 to facilitate individuals and associations of persons seeking to file through e-filing their income tax returns for the tax year 2009.

The e-filing facility has already attracted considerable interest and response from the taxpayers with 61 of them filing their returns electronically during the first two days. The e-filing software is likely to go a long way in facilitating the taxpayers in filing their returns in a timely and comfortable manner.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 23, 2009 Govt issues SRO for 8pc GST on local supplies of sugar

Click to View SRO

The government has announced to charge sales tax at the rate of eight per cent on local supplies of sugar, says a press release issued by FBR Sunday.

The announcement has been made following issuance on Sunday of SRO(I)/2009 whereby “sales tax on local supplies of sugar shall be charged at the rate of eight per cent with immediate effect and until further orders”. A copy of the SRO is attached for reference.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 22, 2009 Sugar producers agree on Rs 45 per kg price for 3 months

Sugar producers have agreed to sell 200,000 tonnes of sugar at ex-mill price of Rs 45 per kilogram during the next three months, says an official press release issued by FBR Saturday.

The major cut in sugar prices has been made possible following an understanding reached between the government of Pakistan and sugar producers during a meeting at the Prime Minister’s House.

According to the understanding, sugar producers will sell 200,000 tonnes of sugar at ex-mill price of Rs 45 per kg for the next three months while the government in return will provide 50 per cent exemption on taxes levied on sugar.

It is hoped this arrangement will help in stabilising sugar prices in the local market besides easing the pressure on the common man till the next sugarcane crushing season in November 2009.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 20, 2009 FBR collects Rs 74 billion in July 2009

Click for detail

Federal Board of Revenue (FBR) collected Rs 74.07 billion of revenues during the first month of the 2009-10 fiscal year showing increase of 2.4 per cent over corresponding period of the last year.

According to the provisional figures, the FBR has collected Rs 74.07 billion during the month of July 2009 as against Rs 72.36 billion collected during the corresponding month last year. The break-up of the tax collection figures is attached for further details.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 11, 2009 TARIN VOWS TO ENHANCE REVENUE THROUGH DETERMINED EFFORTS
 

We have no other option but to enhance revenue in order to support our government and economy during the difficult times. Addressing FBR Members, Chief Collectors and DGs of Large Tax Payers Units and Regional Tax Offices, Shaukat Tarin, Minister for Finance, Revenue, Economic Affairs & Statistics stressed upon FBR for determined efforts towards increasing the revenue. He was presiding over a Conference of Chief Collectors and DGs of Large Tax Payers Units and Regional Tax Offices here in Islamabad on 21st August 2009. Secretary Finance/Revenue Division, Salman Siddique was also present at the occasion among other FBR officials.

Members of Advisory Council on Revenues, S. Shabbar Zaidi, Bashir Ali Mohommad, Saqib Sherani and Shahid Hussain attended the said conference and offered proposals and suggestions towards developing a tax compliant culture.

Talking about revenue contribution made by different sectors, the Minister said, we have to enhance Tax to GDP ratio from 7% to 15- 20 percent by the year 2010. He was of the view that if we look at the contributions of Agriculture Sector towards the GDP, it is 22 percent but zero in the revenues, similarly Services Sector contributes 52 percent in the GDP but their contribution in revenues is only 17%. Whereas, Capital gains of Stock Exchange and Real Estate Sectors has much more potential. He showed his confidence in tax machinery and said that with realization of the situation and commitment we can achieve the desired results.

The Minister urged FBR to conduct a Third Party Audit, which would be carried with the help of ICAP. Strategy to improve collection, review and update on the revenue targets assigned to field formations, uniformity of practices in examination, valuation, assessment and trade facilitation and strategy to check smuggling also came under discussions.

Chairman FBR, Sohail Ahmad, in his concluding remarks assured that through the ongoing re-organisation of tax machinery, a definite improvement is expected. He was optimistic towards better performance of all the field formations. He stated that the main purpose of the Conference is to close the gap between policy making and implementation besides sharing of experience.
 

 
 
 
 

-Sd-
(Ehsanul Haq)
Member FATE / Official Spokesman, FBR
 


August 11, 2009 FBR sets up kiosks to streamline e-filing of tax returns

Federal Board of Revenue (FBR) has set up kiosks and work stations at offices of Large Taxpayers Units (LTUs), Regional Tax Offices (RTOs) Tax Facilitation Centres (TFCs) to streamline electronic filing of income tax returns and withholding tax statements by the taxpayers.

The setting up of work stations comes as part of a broad range of measures being taken on the instruction of FBR Chairman Mr. Sohail Ahmad to promote voluntary compliance as well as to facilitate associations of persons (AOPs) seeking to file their tax returns through e-filing process.

Under the programme, work stations (kiosks) have been established at each LTU/RTO along with provision of two sets of computers with internet connectivity. The stations are being manned by professional and technical staff to extend help to AOPs in e-filing. The computers will also be
available for self service for the AOPs.

Similar work stations have also been set up at all FBR TFCs to serve the AOPs seeking to e-file returns at remote and smaller towns. Besides, FBR has also started organising workshops at all LTUs/RTOs to explain e-filing procedures to the AOPs. Workshops for explaining procedures involving e-filing of withholding tax statements will continue until August 20 while workshops for explaining procedures for e-filing of income tax returns for the tax year 2009 will be held during August 15-17, 2009. As another facilitation measure, the timings of FBR helpline dealing with tax-related queries have also been extended from the existing 9:00am-4:00pm to 9:00am-9:00pm.
 

Urdu Version

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


August 3, 2009 FBR collects Rs 74 billion in July 2009

Federal Board of Revenue (FBR) collected Rs 74.07 billion of revenues during the first month of the 2009-10 fiscal year showing increase of 2.4 per cent over corresponding period of the last year.
According to the provisional figures, the FBR has collected Rs 74.07 billion during the month of July 2009 as against Rs 72.36 billion collected during the corresponding month last year. The break-up of the tax collection figures is attached for further details.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


July 6, 2009 FBR forms body to draw up plan for levy of VAT at retail stage

Click here to see Urdu Version


Federal Board of Revenue (FBR) has constituted a team of senior officials to draw up a plan for the enforcement of VAT (value added tax) at retail stage from the next fiscal year.
The five-member committee comprising senior Customs officials, including Strategic Planning & Statistics Member Mr. Zafar-ul-Majeed and ST&FE Chief Mr. Abrar Ahmad Khan, has been directed by FBR Chairman Mr. Sohail Ahmad to “come up with a comprehensive plan to fully enforce the VAT at retail stage by July 2010,” says a press release issued Monday.
The decision to constitute the process re-engineering team that also includes Collector Sales Tax RTO Lahore, Additional Collector LTU Islamabad and Deputy Director Customs Evaluation Karachi has been taken in view of the importance of extending VAT to the entire retail stage, allowing adjustment of tax paid at earlier stages.
The decision comes in the wake of a growing realization of the fact that a large number of transactions in the economy take place at retail place. While existing legislation provides for levy of VAT at retail stage, its practical enforcement and collection has faced enormous problems for more than a decade and currently only retailers with threshold of Rs 5 million are required to be registered.
It may be added that the 3rd Schedule of the Sales Tax Act, 1990 provides for levy of VAT on the retail process of certain specified supplies, including e.g., cigarettes. Sales Tax Act, 1990 that was enforced in November 1996, is designed for a classical VAT Model. At present, VAT is being collected on imports and supplies by manufacturers, wholesalers, distributors and big retailers.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


July 02, 2009 FBR collects Rs 1150 billion; final figures to be released by weekend

Federal Board of revenue (FBR) has collected over Rs 1150 billion revenue for the financial year 2008-9 so far with a substantial amount of revenues collected for the month of June still in the pipeline.

According to an official statement issued Thursday, several misleading reports have currently been published in some sections of the press depicting an unrealistic picture of the latest revenue collection for the current financial year.

The statement clarifies that a substantial amount of the revenues collected for the month of June 2009 is still in the pipeline and the final figures are likely to be settled by this weekend. Nevertheless, the provincial figures of total revenues worked out so far are over Rs 1150 billion as against Rs 1007-50 billion collected during the last financial year. The present provincial figures thus show an increase of over 14 per cent vis-ŕ-vis the last year’s collection. However, the final figures are expected to be on the higher side.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


June 27, 2009

Banks, FBR offices to remain open on 29th, 30th for tax collection

Authorised bank branches and income tax offices of Federal Board of Revenue (FBR) will remain open on June 29-30, 2009 to facilitate taxpayers and receive tax collections for the ongoing fiscal year, says a press release issued by FBR Saturday.

It says the authorised branches of State Bank of Pakistan and National Bank of Pakistan will remain open until 8:00pm on Monday and until 10:00pm the following day to facilitate taxpayers and receive tax collection. Similarly, income tax offices of the FBR have also been instructed to remain open till 10:00pm on Monday and till 12:00 midnight on Tuesday to facilitate taxpayers and receive tax collections. Steps have also been taken by the concerned bank branches and income tax offices to liaise with each other to ensure that all payments made in the month of June 2009 are effectively accounted for in the current fiscal year ending 30th June, 2009.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


June 19, 2009 FBR, ICAP ink MoU for preparation of tax audit framework

Federal Board of Revenue (FBR) and Institute of Chartered Accountants of Pakistan (ICAP) have signed a memorandum of understanding (MoU) for the development of a tax audit framework for the FBR.

The MoU was signed Friday at a ceremony attended by Federal Revenue Secretary Mr. Salman Siddique, Member (Direct Taxes) FBR, Mr. Irfan Nadeem, ICAP President Mr. Asad Ali Shah and Syed Shabbar Zaidi, Council Member & Chairman Taxation Committee.

According to the MoU to be effective from July 1, 2009, the ICAP will prepare a comprehensive tax audit framework for the conduct of ‘tax audit’ function by the FBR. The institute will also advise FBR regularly on technical matters relating to tax audit and allied subject.

The MoU, to be applied for the time being to company cases only, also calls upon ICAP to work with its members and firms to participate and collaborate in conducting the audit function. Besides, ICAP will extend all possible help in devising audit strategy and mechanism for ‘non-company cases’ for the FBR.

The MoU also allows FBR to implement the tax audit framework in consultation with the Institute in a manner fitting the national interest and in line with policies and procedures as laid down by ICAP.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


June 4, 2009 FBR’s tax collection exceeds Rs 989 billion up to May 2009

Federal Board of Revenue (FBR) collected Rs 989.09 billion of revenues during the first 11 months of the current fiscal year showing increase of 15.5 per cent over corresponding period of the last year.

According to the provisional figures, the FBR has collected Rs 89.88 billion during the month of May 2009. Aggregate collection up to May 2009 thus works out to Rs 989.09 billion as against Rs 856.20 billion collected during the corresponding period of the last year.

The break-up of the tax collection figures is attached for further details.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


May 26, 2009 FBR extends warehousing period for imported goods

The Federal Board of Revenue (FBR) has extended the warehousing period and waived off surcharge on overstayed goods lying un-cleared in the warehouses.
According to press statement issued Tuesday, the measure has been taken to facilitate the trade and industry and commercial importers who have not been able to clear their goods in time on payment of duty and taxes.
FBR has also issued notification No SRO 404(I)/2009 dated 25.05.2009 whereby penal surcharge on goods not cleared for more than prescribed period has been fully waived off. The facility will remain available until June 30, 2009.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


May 24, 2009 FBR mulls ways to achieve budgetary targets


A meeting of senior officials of Federal Board of Revenue (FBR) was held Sunday to discuss strategies for achieving the budgetary targets for the current financial year ending in June.

The meeting was chaired jointly by Mr Irfan Nadeem, Member Direct Taxes, and Mr Mumtaz Haider Rizvi, Member FR&S, and attended by director generals of the Large Taxpayers Units (LTUs) and Regional Tax Offices (RTOs).

The Member Direct Taxes reviewed the performance of field formations vis-a-viz the assigned targets and discussed the potential heads of income tax collection which needed to the explored forcefully by focusing all out efforts and resources. Instructions with regard to broadening of tax base, audit and implementation of new rules were also issued. The director generals vowed to make all out efforts to achieve the budgetary targets.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


May 22, 2009 FBR officer appointed member of UN body

A senior officer of Federal Board of Revenue (FBR) has been appointed member of the UN’s Committee of Experts on International Cooperation in Tax Matters.

Ms Farida Amjad, a BS-20 officer currently posted as chief International Taxes in the FBR House, has been appointed as member of the prestigious UN body by the Secretary General of the United Nations for a period of four years. Among other functions, the UN body also regularly reviews and updates the United Nations Model Tax Convention on Income and Capital.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


May 7, 2009 FBR’s tax collection exceeds Rs 898.6 billion up to April 2009

Click here to see Urdu Version

Federal Board of Revenue (FBR) collected Rs 898.64 billion of revenues during the first 10 months of the current fiscal year showing increase of 17.7 per cent over corresponding period of the last year.

According to the provisional figures, the FBR has collected Rs 83.53 billion during the month of April 2009. Aggregate collection up to April 2009 thus works out to Rs 898.64 billion as against Rs 763.59 billion collected during the corresponding period of the last year.

The break-up of the tax collection figures is attached for further details, Please Click Here
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


April 17, 2009 FBR denies misplacement of duty drawback cheques

Federal Board of revenue (FBR) has denied reports appearing in a section of the press regarding alleged misplacement of duty drawback cheques at Customs offices in Karachi.

In an official statement issued Friday, FBR has maintained that no duty drawback cheques pertaining to members of the Pakistan Tanners Association were ever stolen or misplaced as reported at the offices of the Customs Administrative Reforms (CARE) Directorate or Pakistan Customs Computerised System Collectorate (PACCS) and consequently there was no question of
issuing duplicate cheques.

The statement further said that a key reason behind non-receipt of duty drawback cheques by the exporters was their submission of non-operational/outdated account numbers. However the system was being streamlined to ensure a smooth issuance of duty drawback cheques to the exporters and as a facilitation measure the board had decided to issue fresh cheques to reputed manufacturers-cum-exporters on undertaking the amount involved in the fresh cheques would be deducted from their future duty drawback claims in case old cheques were found encashed. The cases of duty drawback pertaining to members of Pakistan Tanners Association were also being scrutinized on these lines and they would be issued fresh cheques soon upon fulfillment of the requisite precautions.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


April 14, 2009 FBR sees no merit in steel industry’s protest on WHT payment

Federal Board of Revenue (FBR) has told the country’s steel industry withholding tax on electricity, gas and telephone bills and imports is  imposed through the Act of Parliament and the industry’s claim that it is being coerced to pay 3.5 per cent tax on their purchases is wrong.

In a press release issued on Tuesday, FBR has maintained that steel mills managed by Association of Persons (AOPs) have to withhold 3 per cent tax from payments owed to their suppliers and such withholding tax has nothing to do with the steel mills’ own liability. Steel industry has to discharge its obligations including withholding of tax from payments owed to their
suppliers, under the Income Tax Ordinance, 2001 like all other sectors. No other sector has agitated the withholding of tax on payments owed to suppliers so far.

FBR has also contended that tax withheld under section 235 of the Income Tax Ordinance 2001 constitutes discharge of final tax liability in the cases of suppliers doing business in the status of individuals and AOPs and is a measure to ensure that all supplies are brought into the tax net. Steel sector has agitated the withholding tax on suppliers without proper appreciation of legal provisions.

The FBR has further added that such issues have been discussed time and again with the representatives of steel industry and as such their demands are inadmissible under the law and cannot be accepted.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


April 13, 2009 FBR levies 15pc duty on export of molasses
Federal Board of Revenue (FBR) has imposed 15 per cent regulatory duty on export of molasses, says an official statement on Monday.

The FBR issued an S.R.O.321(I)/2009 dated 10/04/2009 whereby a regulatory duty at the rate of 15 per cent ad valorem has been imposed on the export of molasses following a summary moved by Ministry of Industries & Production.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


April 09, 2009 FBR trying to provide fiscal space to govt, says Ahmad Waqar

Federal Board of Revenue (FBR) Chairman Mr Ahmad Waqar has said FBR is striving to provide a greater fiscal space to the government by improving the tax-to-GDP ratio and broadening the tax base.

Mr Waqar was addressing participants of the 90th National Management Course during their visit to the FBR House on Thursday. He said FBR had taken various steps in recent years as part of a reform process to change the image and perception of FBR, broaden tax base, rationalize tax/tariff rates, improve resource mobilization efforts, encourage voluntary compliance ,
simplify tax laws and procedures, facilitate businesses and improve efficiency, integrity and transparency.

Speaking on the occasion, Mr Irfan Nadeem, member Inland Revenue Service, said FBR was committed to enhancing the capability of the tax system to collect due taxes through application of modern techniques, providing taxpayer assistance and by creating a motivated, satisfied, dedicated and professional workforce.

He also briefed the participants on the functioning of FBR and highlighted the success of the ongoing reforms programme in achieving a greater autonomy and reorganization of FBR and its field offices on functional lines, integration of domestic taxes management, separate handling of large taxpayers, introduction of one-stop shop operation, improvement in physical infrastructure and compensation to employees.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


April 01, 2009 FBR’s tax collection exceeds Rs 810 billion up to March 2009

Click here to see Comparison

Federal Board of Revenue (FBR) collected Rs 810.32 billion of revenues during first nine months of the current fiscal year.

According to the provisional figures, the FBR has collected Rs 103.82 billion during the month of March 2009. Aggregate collection up to March 2009 thus works out to Rs 810.32 billion as against Rs 679.9 billion as were collected during the corresponding period of the last year.

The break-up of the tax collection figures is attached for further details.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407

 
March 29, 2009 FBR launches drive to ensure filing of IT returns in non-salary cases

Click here to see Urdu Version

Federal Board of Revenue (FBR) has decided to launch a countrywide campaign to ensure filing of Income Tax returns in non-salary cases, says an official press statement issued here.

The decision made in the wake of a high priority being attached to the enforcement of Income Tax returns in the non-salary cases, has been conveyed to director generals of all Regional Tax Offices (RTOs) which have been directed to constitute dedicated team of officers to spearhead the campaign for persuading the non-filers to file Income Tax returns for the Tax Year
2008. Permission letters to the teams will be issued by the concerned commissioners holding charge of the broadening of tax base. The commissioners will also be responsible for the supervision and monitoring of the campaign.

The FBR has also directed the RTOs to assign the teams running the campaign specific geographical areas of their operation within the respective RTOs.

The officials have also been advised to ensure transparency and commitment during the campaign while those showing excellent results have been promised rewards under the Unified Reward Rules. The results of the campaign will be intimated by the RTOs to the Board on the last working day of every week.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


March 29, 2009 LTUs, RTOs to remain open on Sunday to tend to tax matters

Federal Board of Revenue (FBR) has directed all its Large Taxpayers Units (LTUs) and Regional Tax Offices (RTOs) to remain open on March 29, 2009 for the purpose of clearance of pending official work of the third quarter, says an official statement issued on Saturday.

According to the statement, the field formations will remain open on Sunday (tomorrow) during the routine office hours to attend to necessary official matters.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


March 28, 2009 Customs seize counterfeit cigarettes

Click here to see Urdu Version

The Directorate General of Intelligence and Investigation of the Federal Board of Revenue (FBR) has foiled an attempt of smuggling a massive quantity of counterfeit cigarettes and cosmetics.

The contraband goods were confiscated by Customs officials during a raid at the Attock Check Post where a truck was intercepted following a tip-off. The raiding team led by deputy director Hasan Ali searched the vehicle and found a massive quantity of smuggled cigarettes and cosmetics stashed in different parts of the truck. Driver of the truck and others were also arrested.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


March 20, 2009 100% concession on customs duty to Sri Lankan goods

Federal Board of Revenue (FBR) has granted 100 per cent concession on payment of customs duty to goods imported from Sri Lanka under Pak-Sri Lanka Free Trade Area (PSFTA), says a press release issued here Friday.

The FBR has issued notification SRO 248 (I)/2009 whereby all goods imported under Pak-Sri Lanka Free Trade Area (PSFTA) agreement barring those mentioned in SRO 570(I)/2005 would enjoy hundred per cent reduction in custom duty.

Under the PSFTA, Pakistan was required to reduce custom duty by 100 per cent in three phases. With the issuance of the latest SRO, the third and final reduction amounting to 100 per cent has been granted to Sri Lankan goods. The concession is subject to fulfillment of rules of origin as provided under the relevant SROs and PSFTA.


Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


March 03, 2009 FBR's tax collection exceeds Rs 706.4 billion up to February, 2009

Federal Board of Revenue (FBR) collected Rs 706.46 billion of revenues during the first eight months of the current fiscal year showing increase of 20.7 per cent over corresponding period of the last year.

According to the provisional figures, the FBR has collected Rs 75.98 billion during the month of February 2009. Aggregate collection up to February 2009 thus works out to Rs 706.46 billion as against Rs 585.3 billion as were collected during the corresponding period of the last year.

The break-up of the tax collection figures is attached for further details.

(Urdu version) FBR collects Rs 706.4 billion up to February 2009

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 20, 2009 FBR denies reports of PSO bail-out fund

A spokesman of the Federal Board of Revenue (FBR) has denied the contents of a news item captioned 'Rs 75bn fund in offing to bail out PSO' and appearing in a section of the press on February 15, 2009.

In a statement, the spokesman has clarified that the report has wrongly attributed the setting up of the bailout package for Pakistan State Oil to the FBR chairman Ahmad Waqar who has been quoted in the reports as having made this during a visit to Korangi Association of Trade and Industry last week. The fact is that the visit was meant to have an interactive session with the business community and the FBR chairman made no statement whatsoever with regard to setting up of a fund for PSO.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 16, 2009 Ahmad Waqar underscores change management for successful reforms

Federal Board of Revenue (FBR) Chairman Ahmad Waqar has called for better organizational communication and an effective feedback from the employees to successfully complete the reform process under way in the FBR.

He said the FBR as an organization was at a critical juncture of the reforms process that was started five years ago and was to by the end of 2009. "We must not allow the momentum of the reforms to be lost and work as a team to end the reforms process on a successful note," he said while addressing a workshop on 'Change Management', organised by the Human Resource Wing of the FBR at a local hotel Wednesday.

Mr. Waqar called for organization of more workshops and interactive sessions for the FBR officials to better understand and review the process and benefits of effective change management and seek ways to further improve management to maximize the organizational potential.

The workshop was moderated by Mr. Alan Gilmour, a London-based HR consultant, who also spoke at length on the concept of change management. The workshop was attended by FBR members and director generals of various
Large Taxpayers' Units.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 16, 2009 New administrative measures not to hit careers, FBR chief tells officers

Federal Board of Revenue (FBR) Chairman Ahmad Waqar has vowed to move ahead with the reforms process under way in the FBR but has assuaged any apprehensions resulting out of the ongoing integration of various functions to modernize the tax administration.

"I can't take sides but I would definitely take sides with the reform process which is the key to improving revenue generation and modernizing FBR to prepare it for future challenges," he said while addressing officers of the Customs & Excise Group at Karachi.

Mr. Waqar told the officers that he understood their concerns with regard to the new administrative arrangement that had been put in place in FBR but their concerns were largely based on mere apprehensions. "The introduction of new administrative changes is an operational-cum- management step which would not jeopardize the promotion prospects, allocation of seats and career paths or discriminate officers of one group in favour of the other," he added.

However, he said the Board was committed to implementing the reforms agenda and the integration was a consistent theme that had been recommended over the years by various agencies/international bodies. The essential objective was to create a fully integrated tax administration of sales tax, excise and income tax mechanism for improving tax facilitation, removing distortions, preventing revenue leakage, broadening and widening of tax net and enhancing tax to GDP ratio.

The chairman said the setting up of Inland Revenue mechanism was just the start of a process that reflected a futuristic approach and would be completed over a period of time and inputs from all the stakeholders would be obtained for attaining the goals and achieving the objects in an effective manner.

He urged officers and staff of the FBR to stand fully behind the reforms and dedicate their energies to meet the revenue collection targets. "Put in your best and the system is ready to support you," he concluded.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 12, 2009 Tax relief for goods imported for Hubco power project

Federal Board of Revenue (FBR) has exempted from payment of withholding tax goods imported by contractors engaged in the execution of power project by the HUB Power Company Limited.

The exemption was granted through SRO 129(1)2009 issued under sub-section (2) of section 53 of the Incoem Tax Ordinance 2001 (XLIX of 2001). Previously, goods or class of goods imported by contractors or sub-contractors engaged in the execution of power project under the agreement between the government of Pakistan with HUB Power Company Limited, were exempt from the provisions of section 148 on import of such goods etc under sub-clause (i) of clause (56) of Part IV of the Second Schedule to the Income Tax Ordinance, 2001. However, the clause (56) of Part IV of the Second Schedule was substituted vide the Finance Act, 2008, and in the substituted clause, the exemption available from WHT u/s 148 to the company was discontinued. The exemption granted to the company would continue until completion of the project as per international commitments and the agreement signed with the government.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


February 3, 2009 FBR’s tax collection exceeds Rs 628 billion up to January, 2009

Federal Board of Revenue (FBR) collected Rs 628.22 billion of revenues during first seven months of the current fiscal year showing increase of 22.6 per cent over corresponding period of the last year.
According to the provisional figures, the FBR has collected Rs 74.39 billion during the month of January 2009. Aggregate collection up to January 2009 thus works out to Rs 628.22 billion as against Rs 512.6 billion as were collected during the corresponding period of the last year. The break-up of the tax collection figures is attached for further details.

 
For Figure Please Click Here

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


January 21 2009 Waqar seeks improvement in revenue collection to meet targets

Federal Board of Revenue Chairman Ahmad Waqar has called for concerted
efforts to improve revenue collection to meet targets.

"The FBR officials and staff must apply themselves to the task with professional commitment and dedication," he said in a keynote address to the 3rd meeting of the director generals of Large Taxpayers' Units (LTU)/regional tax offices (RTOs) held at Federal Board of Revenue (FBR)
here Wednesday.

The meeting was inaugurated by Chairman, FBR and attended by Mr. Irfan Nadeem, Member (Inland Revenue).

Mr. Abrar Ahmad Khan, Member (Audit), Mr. Nau Bahar Kiyani, Member (Tax Policy & Reforms) and Muhammad Anees Member (Enforcement & Accounting) also attended alongwith DG from 16 reformed units and all Chiefs/Secretaries of Income Tax Wing.

Mr. Waqar told the participants a composite audit plan of selected corporate cases would be conducted through chartered accountants and modalities in this regard are being worked out in collaboration with the Institute of Chartered Accountants of Pakistan (ICAP). He asked the director generals, LTUs/RTOs to vigorously pursue cases involving big tax evaders and
non-filers to ensure compliance with tax laws.

Earlier Member (Inland Revenue) Mr. Irfan Nadeem presented a review of the  six-monthly performance of direct taxes and urged the director generals to overcome shortfall in their targets. He also exhorted them to ensure that the audit was conducted in a fair and transparent manner without harassment of the taxpayers. He apprised the participants of the new changes made in the administrative set up of top hierarchy of FBR, which he said was aimed at achieving the desired objectives of the reform process. He informed the audience of various policy decisions including reward policy for officers and staff.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


January 15 2009 TAX ADMINISTRATIONS OF DIRECT TAXES, SALES TAX AND FEDERAL EXCISE INTEGRATED INTO “INLAND REVENUE”

    Government of Pakistan is committed to enhance domestic resource mobilization as part of its stabilization and reform strategy to meet the targets of sustainable growth. A key element in this regard is the establishment of a fair and efficient tax administration.

  2. FBR has been undergoing a comprehensive Program of Tax Administration Reforms. The Program aimed at restructuring of FBR on the pattern of leading modern tax administration. The Tax Reform Program envisaged a functionally integrated tax administration of sales tax, federal excises and direct taxes. The key element was to facilitate the taxpayers by providing universal self-assessment across all taxes. It would not be possible to implement the system effectively without having a functionally designed tax administration. The FBR continued to operate in separate domains of Direct Taxes and Sales Tax / Federal Excises with partial design adjustments at Headquarters and field formations.

   3. Accordingly, the tax administrations of direct tax, sales tax and federal excise have been integrated into a single position of Inland Revenue headed by a single Member. He is responsible for all field operations at the Regional Tax Offices and Large Taxpayers Units across the country. This step is intended to facilitate taxpayers by creating a single window access and aligning all business processes to promote a tax compliant culture.

   4. In addition, a new support function of enforcement & accounting has been introduced in the functional design which is to be administered by a separate Member. At the same time the taxpayers’ audit has also been entrusted to an independent Member separating it from the internal audit function.

Related Notifications:

  1. The post of Member (Direct Taxes) is re-designated asMember (Inland Revenue).

  2. Re-designation of Member (ST/FE) &Member (HRM)

  3. Re-designation of Member (IMS), Member(Audit) and Chief (ST&FE-I)

  4. Member (Inland Revenue)
     

 

- Signed-
(Mahmood Alam)
Member. FATE / Official Spokesman, FBR
 


January 2, 2009

FBR collects Rs 543.3b for July-December 2008 period; tax collections for December 2008 touch Rs 114.2b

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


January 2, 2009

FBR issues notices to corporate bodies on failure to file returns

Federal Board of Revenue (FBR) has issued notices to those corporate entities that have failed to file income tax returns, says a press release issued Friday.

According to the statement, the FBR has also decided to issue in the next phase similar notices to non-corporate entities which have not filed their income tax returns.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


January 1, 2009

FBR nets Rs 1.54b from tax investment scheme

Federal Board of Revenue (FBR) has collected Rs 1.54 billion from the tax investment scheme announced in July this year, says a press statement issued Thursday.

According to details, some 10,828 cases seeking to benefit from the scheme were received by FBR until December 31, 2008, the last day of the scheme, and were settled after netting Rs 1,542 million as tax equaling two per cent of the fair market value of their assets.

The scheme was run by the 16 regional tax offices and large tax payers units of the FBR and received a record 4,114 cases from the RTO Lahore followed by 1,861 cases received in RTO Karachi. The break-up of the collection is also attached for further details.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


January 1, 2009

No plans to slash tax exemptions on food, medicines, says FBR

Federal Board of Revenue (FBR) while clarifying a news item appearing in a section of the press attributing a statement to Chairman FBR in the context of tax exemptions has stated that what the Chairman had mentioned six days earlier has been quoted totally out of context.

In an official statement, FBR has clarified that the news item is essentially based on an earlier news report published in a section of the press on 26th December, 2008 on the issue in which the Chairman FBR has been quoted as having said, “Exemptions as policy are not good for the economy. Wherever exemptions are in vogue, the economy does not show healthy trends in progress, administration and policy-enforcement.”

The Chairman’s statement even though quoted not accurately nowhere implies that the Government intends to remove tax exemptions on food items and medicines. Similarly, the fact that “as food and medicines” has been bracketed in the latest news report clearly shows reporter’s own inference and interpretation which cannot be attributed to the FBR Chairman.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


 
December 26, 2008

No further extension of tax investment scheme after 31st, says FBR

Federal Board of Revenue (FBR) has announced there will be no extension of period already given up to December 31, 2008 for the filing of returns for investment tax scheme announced in July this year.

In a statement issued on Friday, FBR's member Direct Taxes said the board had decided not to extend the last date of December 31, 2008 for those wanting to apply for the tax investment scheme whereby individuals can declare their undeclared assets by paying only two per cent of the fair market value of their assets.

Similarly, there would be no extension of date for the e-filing of income tax returns for the corporate sector. He said the taxpayers seeking to file their income tax returns in the corporate sector must use e-filing mode and the last date for them to do so will not be extended beyond December 31, 2008.

The member called for an early e-filing of returns by taxpayers to avoid any punitive measures the board might consider taking against those failing to benefit from the scheme. He said the FBR was in possession of sufficient information and relevant data to trace up those who would not avail of the tax amnesty facility offered by the FBR.

 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


December 24, 2008 FBR denies holding up duty drawbacks, sales tax refunds

Federal Board of Revenue (FBR) has refuted a news item appearing in a section of the press claiming the board has held up duty drawback and sales tax refunds payable to the exporters.

In an official statement issued on Wednesday, FBR has clarified that the contents of the news item are not based on facts and there is no truth in the suspension as reported by the press, of the processing or payment of admissible drawback and refund claims.

The statement adds that in the first five months of the current financial year, an amount of Rs 15.45 billion has already been paid to the exporters as duty drawback and sales tax refunds, as against Rs 14.36 billion during the corresponding period of the previous year. Similarly, inputs used in five major export oriented sectors have already been zero rated for sales tax purpose. Sales Tax refunds relating to exporters of these sectors have also declined accordingly.

The statement also adds that FBR's measure of universal e-filing of sales tax returns will lead to further acceleration of processing of refund claims. Furthermore, the board is already in the process of devising automated system for expeditious disposal of refund claims pertaining to packing material used in exports by zero rated sectors. For boosting exports, FBR has often directed its field formations to extend maximum facilitation to exporters, including a quick and expeditious processing and payment of pending duty drawback and refund claims.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


December 23, 2008

Customs houses to remain open on 25th, 28th for clearance of imports, exports

Federal Board of Revenue (FBR) has directed all its customs houses and field formations to remain open on December 25th and December 28th, 2008 for the purpose of clearance of imports and exports, says an official statement issued on Tuesday.

According to the statement, chief collector (customs) North Lahore and chief collector (customs) south Karachi have also been directed to coordinate with the National Bank of Pakistan management and the port authorities to ensure the clearance of imports and exports.

Meanwhile, Irfan Nadeem, member Direct Taxes, has made it clear there would be no extension of date for the e-filing of income tax returns for the corporate sector. He said the taxpayers seeking to file their income tax returns in the corporate sector must use e-filing mode and the last date for them to do so will not be extended beyond December 31, 2008.

Similarly, the board has decided not to extend the last date of December 31, 2008 for those wanting to apply for the tax investment scheme whereby individuals can declare their undeclared assets by paying only two per cent of the fair market value of their assets, added Mr. Nadeem. He said already sufficient length of time had been given to people wanting to benefit from
the tax investment scheme which would expire by the end of the current month.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


December 16, 2008

FBR extends date for filing of ST, FE returns

Federal Board of Revenue (FBR) has extended the due date for the filing of sales tax and federal excise return by the registered persons, for the period of Novemeber 2008.

According to an official statement released on Tuesday, the board has extended until December 25, 2008 the due date for filing of sales tax and federal excise return of the tax period November 2008 for the registered persons who had not been able to deposit payment by the stipulated date.

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


December 16, 2008 FBR's moot on 'tax policy options for Pakistan' starts tomorrow

For Urdu Version Please Click Here


Federal Board of Revenue (FBR) is holding an international 'Conference on Tax Policy Options for Pakistan' starting in Lahore tomorrow (Wednesday) to identify and generate concrete implementable tax policy options for achieving the broad micro and macroeconomic objectives.

The three-day conference being organised at a local hotel in the Punjab metropolis will focus on various issues, including the overall macroeconomic constraints, current revenue administration, assessment of main taxes, sub-national taxation and political economy of inter-governmental reforms.

The opening session of the conference will be chaired by Advisor to the Prime Minister on Finance, Mr. Shaukat Tareen who will also deliver a keynote address on the government's efforts to enhance domestic resource mobilization as part of its stabilization and reform strategy to meet the targets of sustainable growth in the medium term.

The morning session will also be addressed by FBR Chairman Mr. Ahmad Waqar who is likely to speak on FBR's endeavours for the establishment of a fair and efficient tax administration promoting investment and production incentives and raising sufficient revenues for the development and poverty reduction programmes of the government.

According to an official statement of the FBR, the conference to be attended by leading national and international experts, aims at engaging technical input and participation of the business community and stakeholders in the policymaking process.
 

Hamid Raza Wattoo
Secretary PR
Ph: 051-920 8407
Fax: 051-920 8407


December 02, 2008

LTU Islamabad to hold workshop on withholding taxes

For Urdu Version Please Click Here

The Large Taxpayers Unit (LTU) Islamabad of the Federal Board of Revenue (FBR) will organise a one-day workshop on 'Withholding taxes (WHT)' on Wednesday (tomorrow) at the Institute of Chartered Accountants of Pakistan (ICAP).

The workshop to be attended by senior officers of the FBR, LTU Islamabad as well as regional tax offices of the twin cities, will start at 2:00pm at the ICAP located at Plot No 2, Mauve Area, G-10/4 Islamabad, and discuss issues pertaining to the monitoring of withholding taxes.

The main feature of the workshop will be a keynote address to be delivered by Muhammad Anwar Goraya, director general of Withholding Taxes FBR, on 'collection and deduction of withholding tax at source'. Khawar Khurshid Butt, director general of the LTU Islamabad, will chair the workshop.

Hamid Raza Wattoo
Secretary (PR)
Ph: 051-920 8407
Fax: 051-920 8407


December 02, 2008 FBR collects Rs 423b revenue for July-Nov 2008

For Urdu Version Please Click Here

Federal Board of Revenue (FBR) has collected Rs 423 billion revenue during the first five months of the current fiscal year, showing a corresponding increase of 24.4 per cent, says a press release issued by the FBR on Tuesday.

According to the provisional figures, the FBR has collected Rs 68.73 billion for the month of November 2008, taking the overall collection figures to Rs 423 billion as against Rs 340 billion collected during the corresponding period last year.

Click here to see break-up of the tax collection figures.

Hamid Raza Wattoo
Secretary (PR)
Ph: 051-920 8407
Fax: 051-920 8407


November 29, 2008 FBR assures help to taxpayers on ‘e-filing hiccups’

For Urdu Version Please Click Here


Federal Board of Revenue (FBR) has assured the large taxpayers against any punitive measures for delays caused by a systemic failure.
“Clear instructions have been passed on to officers concerned to consider genuine grievances of taxpayers and give them all possible help and relief,” said Mr. Khawar Khurshid Butt, director general of Large Taxpayers Unit Islamabad, in a keynote address to a one-day workshop organized by the LTU to discuss issues pertaining to electronic filing of various documents for efficient disposal of tax matters.
The DG said bigger players in the national economy had critical role to play in setting examples of excellence in the business ethics. He said FBR understood the value and benefits of interaction and sharing of information to deepen the confidence level and evoke voluntary compliance to promote corporate social responsibility.
Mr. Butt assured his sustained support to taxpayers in the process of transformation from manual to electronic mode for the purpose of tax matters. He said the workshop has been organized to provide on-hand guidance to the representatives of various companies facing problems in e-filing their annual or monthly withholding statements, copies of audited accounts and other such annexure that under law are required by the tax authorities.
Earlier, Mr. Imtiaz Ahmad Khan, general manager of Pakistan Revenue Automation Limited (PRAL), gave a detailed presentation on the technical aspects of e-filing and pointed out the causes of possible interruptions during the processing of data uploading. He also answered the queries of the representatives and consultants of large tax payers.
A large number of companies attended the event and appreciated the initiative of LTU to facilitate the tax payers. Mr. Hafiz Idress of Rawalpindi Tax Bar said such interfacing and guidance from the FBR is of paramount importance for improving the compliance of tax payers under the modernized system and to keep pace with the technological advancement across the globe.
Mrs. Riffat Shaheen Qazi, commissioner Enforcement Division of LTU, commended her team for organizing the workshop. Sardar Ali Khawja, additional commissioner Enforcement, while moderating the workshop gave an overview of FBR’s efforts to facilitate taxpayers by transforming the system from manual to electronic.
During the question answer session, various representatives of companies gave their valuable input that was noted down by the PRAL to improvise the soft ware for better results and efficient delivery.
 

 

Hamid Raza Wattoo
Secretary (PR)
Ph: 051-920 8407
Fax: 051-920 8407

 

 

November 26, 2008 FBR denies plans to arrest taxpayers

For Urdu Version Please Click Here

Federal Board of Revenue (FBR) has denied contents of a news item appearing in a section of the press claiming the FBR has plans to arrest, jail and take similar stern steps against those guilty of holding black money even after the expiry of the tax investment scheme launched by the FBR.

A spokesman of the FBR has clarified that sections of the report as it has appeared in the media are misleading and contain attributions out of context. "There is no truth in such reports and the FBR has yet to decide about the measures to be taken against those failing to benefit from the ongoing tax investment scheme," says the statement.

Hamid Raza Wattoo
Secretary (PR)
Ph: 051-920 8407
Fax: 051-920 8407


November 25, 2008 Customs officials seize 372kgs drugs

For Urdu Version Please Click Here

Customs officials have seized charas and opium weighing 372 kgs and taken possession of a truck being used to smuggle the drugs from Peshawar into Punjab, says a press statement issued on Wednesday.

The raid was conducted by officials of the Directorate General Intelligence and Investigation of the FBR following a tip-off about an attempt to smuggle a massive quantity of drugs from Peshawar to Punjab by truck No RIH-1396.

The officials set up a picket close to Ring Road Peshawar and tried to intercept the truck when it approached them. However, the driver of the truck sped away. The officials chased the truck and found it abandoned on the GT Road with the driver having escaped. The officials searched the truck and recovered 350 kgs of foreign origin charas and 22 kgs of foreign origin opium.
 

Hamid Raza Wattoo
Secretary (PR)
Ph: 051-920 8407
Fax: 051-920 8407


November 25, 2008 FBR to guide large taxpayers on e-filing

For Urdu Version Please Click Here

Federal Board of Revenue (FBR) will organize tomorrow (Thursday) a workshop to provide assistance and guidance to large taxpayers on filing their IT returns and withholding statements through e-filing.
The one-day workshop is being organized by Large Taxpayers Unit (LTU) Islamabad at the Directorate of Training (Direct Taxes) Huzaifa Centre, I-8 Markaz, Islamabad. Noted IT experts from FBR and other organisations will address the workshop on issues regarding different benefits and processes of e-filing.
FBR has invited large taxpayers, especially those facing problems and constraints with regard to e-filing of their returns and statements, to attend the workshop to share their experiences with the IT experts with a view to seeking their guidance. Those interested in attending the workshop can give their suggestions and input on e-filing in advance to Mr. Sardar Ali Khawaja, Additional Commissioner Enforcement, LTU, Huzaifa Centre, I-8 Markaz, Islamabad on phone 051-9258562, fax 051-9258560 and email ltuisbenf@gmail.com.
 

Hamid Raza Wattoo
Secretary (PR)
Ph: 051-920 8407
Fax: 051-920 8407


November 24, 2008 Pakistan, Swiss Confederation ink treaty for avoidance of double taxation

For Urdu Version Please Click Here

Pakistan and the Swiss Confederation have signed a treaty for the avoidance of double taxation previously payable on the income of residents and businessmen of the countries. Tax officials of both the countries Monday met here in Islamabad to exchange the necessary Instrument of Intent to bring into force the revised Convention for Avoidance of Double Taxation. The two sides were led by Swiss Ambassador to Pakistan, Mr. Markus Peter, from the Swiss Confederation and
Mr. Ahmad Waqar, Secretary Revenue Division and Chairman FBR, from Pakistan.

Addressing a ceremony held at the FBR Headquarters for the exchange of Instrument of Intent, Mr. Irfan Nadeem, Member Direct Taxes FBR, welcomed the Swiss ambassador and explained the main features of the revised Convention.

According to the revised Convention, dividend in case of companies having 20 per cent share will be taxed at 10 per cent, and all other cases will be taxed at 20 per cent in the source country. Similarly, interest income may also be taxed in the contracting state in which it arises at 10 per cent of the gross amount.

The Convention further stipulates royalty in the source country to be taxed at 10 per cent; fee for technical services to be taxable at 10 per cent in the source country; and grant of exemption to students on remuneration from the employment which does not exceed 18,000 Swiss francs or the equivalent thereof in Pakistan currency at the official rate of exchange.
   
Speaking on the occasion, Mr. Ahmad Waqar, Secretary Revenue Division, hailed the revised Convention as the necessary step towards providing safeguards against double taxation on the income of the residents of both the countries as well as promoting economic cooperation, investment and bilateral economic relations between the contracting States.

He said the Convention will also provide adequate certainty in respect of taxation rules applicable to cross-border business transactions, dividends, interests, royalties and fee for technical services etc. Taxpayers of both the countries will get relief from double taxation resulting in boosting up the trading activities.

Swiss Ambassador Mr. Markus Peter thanked FBR officials for the warm welcome and expressed hope that the new Convention will be a significant step in improving the bilateral taxation relations between the two countries.

Hamid Raza Wattoo
Secretary (PR)
Ph: 051-920 8407
Fax: 051-920 8407

 

 

30th August, 2008 FBR SURPASSES JULY-AUGUST REVENUE COLLECTION TARGET

FBR has surpassed the revenue target of Rs 134.8 billion, fixed for July -August 2008-09. The provisional tax collection indicates a cumulative growth of 25.7%. The net collection during the period has been Rs 139.7 billion as against Rs 111.1 billion during the same period of last year. The revenue on account of direct taxes has shown a healthy increase of 29.1% by collecting Rs 37.6 billion against Rs 29.1 billion. The sales tax collection has reached to Rs. 65.4 billion against Rs 55.1 billion, indicating a growth of 18.8%. The tax receipts on account of federal excise have registered a growth of 74.4%, during the period under review. The collection has reached to Rs 14.7 billion as against Rs 8.4 billion in the corresponding period of last year. Finally revenue from Customs duties has increased by 19.0% over the corresponding period of last year. The net collection has been Rs. 22 billion against Rs 18.5 billion last year.

Provisional collection during the month of August 2008 indicates that an amount of Rs 66.9 billion has been collected. Of the total taxes, direct taxes has collected Rs 18.9 billion, sales tax Rs 31.9 billion, federal excise Rs 6.5 billion and Customs duty Rs 9.6 billion.

It may be added that the figures are provisional and likely to increase further at the time of finalization.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


30th August, 2008 SALES TAX AND FEDERAL EXCISE RETURNS FILING DATE EXTENDED UP TO 5TH SEPTEMBER 2008

 Federal Board of Revenue has further extended the date for online submission of Sales Tax and Federal Excise Return for the tax period July, 2008 up to 5th September, 2008, by issuing Sales Tax Circular No. 07/2008 dated 30th August 2008. However, the last date for payment of due taxes shall remain unchanged at 20th August, 2008 as extended vide Sales Tax Circular no. 05/2008 dated 16.08.2008.

It is also clarified that no further extension for the aforesaid tax period shall be allowed. Therefore, the taxpayers are requested to avail this last extension and file the returns by the 5th September, 2008.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


29th August, 2008 EXPLANATORY NOTES FOR SRO 895(1)/2008

Federal Board of Revenue has issued a Notification (Income Tax) / SRO 895 (1)/2008, on 27th August, 2008. Following are its explanatory notes:

This SRO is being issued in consequent to the introduction of a new provision in the Income Tax Ordinance, 2001 through Finance Act, 2008 which has given powers to the Commissioner to require any person to install and use an electronic tax register of such type and description as may be prescribed for the purpose of storing and accessing information regarding any transaction that has a bearing on the tax liability of such person. This provision of law is an importance step towards the documentation our economy and now the sale transactions of big retailers and whole sellers may be audited for the taxation of their income. This provision will not only help to assess the real tax liability of a person but will also reduce the discretion of the department which may be used for assessing such sale transactions by bald estimation.

For the above purpose operational legal provisions were also required which have been incorporated in the income Tax Rules, 2002 through the above SRO prescribing the modus operandi of installation, use, identification number, maintenance, and inspection by the tax authority of the Electronic Tax Register (ETR).
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


28th August, 2008 IMPORT OF MINERAL OIL FOR AGRICULTURE EXEMPTS FROM 5% CUSTOMS DUTY

Federal Government has exempted 5% customs duty on import of mineral oil by persons registered with Plant Protection Department as importer, formulator or manufacturer of pesticides, if imported by October, 2008, by issuing Notification (Customs) / SRO 892(I)/2008 dated 27th August, 2008 amending SRO 567(I)/2006 dated 05-06-2006 for its use as an adjuvant for the effective control of attack of Mealy Bug on cotton crop.

 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


28th August, 2008 EXPLANATORY NOTES FOR SROs 894 & 897 (I)/2008


Federal Board of Revenue has issued two Notifications (Sales Tax) / SROs 894 & 897 (1)/2008, first on 25th and second on 27th August, 2008, respectively.

Explanatory notes for SRO 894 (1)/2008 dated 25th August, 2008, are as under:

Acrylic polymer in primary form was zero-rated vide SRO 509(I)/2007 dated 09.06.2007. However, its PCT heading was mentioned as 3906.9080 instead of 3906.9090. The mistake was rectified vide SRO 538(I)/2008 dated 11.06.2008. Now this correction has been given retrospective effect vide SRO 894(I)/2008 dated 25.08.2008 for the benefit of general public.

Explanatory notes for SRO 897(I)/2008 dated 27th August, 2008, are as follows:

In order to reduce input cost of agriculture products, the ECC recommended removal of customs, sales tax and income tax on mineral oil in its meeting dated 15.07.2008. Accordingly, sales tax exemption has been granted to importers of mineral oil not exceeding 250 tons for manufacture of pesticides subject to a certification by Plant Protection Department.

 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


25th August, 2008 UNIVERSAL e-FILING OF SALES TAX RETURNS: FBR APPRECIATES EXCELLENT RESPONSE OF TAXPAYERS.


Response of business community to FBR’s landmark decision of mandatory electronic filing of Sales Tax Returns has been excellent. The measure aims at requiring the registered persons to file their declarations electronically at FBR’s website, without going through the hassle of making long queues in front of banks for paying sales tax and submitting the returns. For creating awareness about the smooth implementation of the e-filing, FBR conducted seminars in all the major cities, in coordination with representative trade bodies. Alive to the fact that initial phase of such a remarkable step towards automation would entail problems of comprehension and awareness, FBR adopted a proactive approach at the highest level for redressal of problems and removal of difficulties. For this purpose, Member (Sales Tax & FE) Mr. Abdul Wadood Khan visited the offices of FPCCI Karachi, LCCI, Faisalabad Textile Export Association, tax bodies and different RTOs at Lahore last week to ascertain from the taxpayers the problems being faced by them with a view to taking corrective action. The salient features of the scheme were explained and the leaders of the business community were asked to provide list of registered persons facing hardship in e-filing so that difficulties, if any, are removed forthwith.

The business community and the e-Intermediaries have shown an overwhelming response and so far 44,309 taxpayers have obtained e-Enrollment at FBR Portal and 32,296 taxpayers have filed their Sales Tax Returns electronically from their offices/ homes using internet. All remaining taxpayers are either in the process of e-enrollment or preparation of electronic returns.

For providing telephonic help in using the system a contact centre, which operates round the clock (24 Hrs), is also established at (051) 111-772-772. The taxpayers are also provided assistance through e-Mails which are received at eSupport@pral.com.pk. For those taxpayers who have difficulty in working on the eFBR Portal due to internet or power problem, FBR has established self service Kiosks and operator assisted help desks in the Regional Tax Offices. In addition to the arrangements described above, a data centre with high speed bandwidth of internet has been established with an adequate setup of computer equipment to handle the e-filing. The high speed band width arranged by is expanded automatically on need basis; where as the maximum bandwidth utilized by the taxpayers during this month is 40 Mbps.

Keeping in view the learning curve of taxpayers and large scale change management from paper based filing of returns to e-Filing, FBR has extended the last date of e-Filing of sales Tax returns to 31st August 2008.
 

 

(Muhammad Hafeez Mughal)
Secretary (PR)


25th August, 2008 EXTENSION IN DUE DATE FOR FILING OF SALES TAX AND FEDERAL EXCISE RETURN BY THE REGISTERED PERSONS.


The Federal Board of Revenue has extended the date for online submission of Sales Tax and Federal Excise Return for the tax period July, 2008 up to 31st August, 2008, by issuing Sales Tax Circular no. 06/2008 dated 25th August 2008. However, the last date for payment of due taxes shall remain unchanged at 20th August, 2008 as extended vide Sales Tax Circular no. 05/2008 dated 16.08.2008.

-Sd-
(Abdul Hameed Memon)
Secretary (ST&FE-L&P)


22nd August, 2008 EXPLANATORY NOTES FOR SRO 840(I)/2008

Federal Board of Revenue has issued Notification (Sales Tax) / S.R.O. 840 (1)/2008 dated 13th August, 2008 which amends Sales Tax Rules, 2006, with following objectives:

(i) To provide that where an e-intermediary, filing return on behalf of his clients, has retained a printed copy of the return electronically transmitted by him duly signed by the representative of the registered person, he shall be deemed to have transmitted the return in good faith and the provisions relating to fiscal and other liability of e-intermediary under sub-section (5) of section 52A of the Sales Tax Act, 1990, shall not be applicable.

(ii) New format of payment challans for sales tax and federal excise has been prescribed.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


22nd August, 2008 EXPLANATORY NOTES FOR SRO 862(I)/2008

Federal Board of Revenue has issued Notification (Sales Tax) / S.R.O. 862 (1)/2008 dated 20th August, 2008 which amends the Sales Tax Special Procedures Rules, 2007, with following objectives:

(i) To remove references to income tax in the Chapter relating to retailers. These references were redundant as income tax rates had already been omitted through budgetary measures.

(ii) To provide that commercial importers shall not be entitled to refund of sales tax paid at import stage in case of excess of input tax over output tax.

(iii) To prescribe new amounts of sales tax to be mentioned on invoices issued by registered persons in steel sector. The new amounts are based on rate of 16% whereas old rates were based on 15%.

(iv) To provide option to steel sector units to operate in VAT mode and prescribe conditions for the same.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


22nd August, 2008 EXPLANATORY NOTES FOR SRO 863(I)/2008

Federal Board of Revenue has issued Notification (Sales Tax) /S.R.O. 863 (1)/2008 on 20th August, 2008. The said notification prescribes monthly submission of production data by manufacturers by 25th of the following month, in respect of 42 items mentioned therein.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


20th August, 2008 IMMOVABLE PROPERTY RATES: CHIEF SECRETARIES ASKED TO EXPEDITE REVIEW OF EXISTING VALUES

Federal Board of Revenue has requested the Chief Secretaries of all the four provinces to respond at the earliest on the Federal Cabinet's decision to review the existing valuation rates of the immoveable properties in their provinces for the purpose of transfer of such properties.

Following the observation of the Federal Cabinet, in its meeting held on June 11, 2008, that valuation rates of immoveable properties do not commensurate with the fair market value of such immoveable properties, the Federal Finance Minister, in his letter dated June 16, 2008, had requested the Chief Ministers of all the four provinces to review and rationalise the existing values fixed for the purpose of their transfer.

Federal Government has not received any response from any of the province so far which indicates that the matter is still under consideration of the provincial governments and the revision of the rates is yet to be made.

It may be noted that the revision of the existing fixed rates was expected to be completed during the month of June and was to be made effective from July 1, 2008.

Member (Direct Taxes), FBR, in his separate letters dated August 13, 2008, has requested all the Chief Secretaries to look into the matter personally and do the needful at the earliest.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


18th August, 2008 5% CUSTOMS DUTY ON IMPORT OF MINERAL OIL FOR AGRICULTURE WITHDRAWN

The Federal Government has exempted 5% customs duty on import of mineral oil by persons registered with Plant Protection Department as importer, formulator or manufacturer of pesticide, if imported by October, 2008, by issuing SRO 857(1)/2008 dated 16-08-2008 amending SRO 567 (1)/2006 dated 05-06-2006 for its use as an adjuvant for the effective control of attack of Mealy Bug on cotton crop.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


18th August, 2008 TAX OFFICIALS ENLIGHTENED ON TAX TREATMENT OF ISLAMIC FINANCIAL INSTRUMENTS

Islamic Finance has gripped the world with a strong fervor and passion. The world is recognizing the significance of Islamic Finance and it had also been deliberated in 2nd and 3rd Session of UN Committee of Experts for International Cooperation in Tax Matters in their annual meeting held at Geneva. Asian Development Bank (ADB) has also introduced it as an agenda item in its meeting scheduled to be held in October 2008 at Tokyo (Japan). It will also be discussed in the 5th ATAIC Technical Conference.

Realizing the importance of this issue, Federal Board of Revenue invited the well known scholars of international repute Prof. Mufti Munib-ur-Rahman and

Mr. Mujeeb Baig in the FBR House, Islamabad to enlighten the senior tax officials of the Direct Taxes Wing on the "Tax Treatment of Islamic Financial Instruments". Mr. Mumtaz Ahmad, Member (Legal), FBR inaugurated the session while Mr. Irfan Nadeem, Member (Direct Taxes) welcomed the honorable guest speakers. Mrs. Farida Amjad, Chief (International Taxes) introduced the guest speakers to the participants.

The guest speakers made a presentation on the Islamic Financial Instruments and enlightened the audience on the basic concept of the riba free instrument. The session was followed by questions / answers, which lasted for one hour and certain future steps to be taken in this regard as to the tax treatment of the Islamic financial Instrument were noted down by the Income Tax Policy Section for examination and necessary action at the appropriate time.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


16th August, 2008 Explanatory notes for Sales Tax / Federal Excise Circular No. 5 of 2008

The Board has extended the due date for the payment of Sales Tax and Federal Excise Duty for the tax period July, 2008 upto 20th August, 2008 in order to facilitate taxpayers who faced difficulties in e-filling their Sales Tax and Federal Excise Returns.
 

(AFTAB AHMAD BHATTI)
Second Secretary (STM)


13th August, 2008

FBR CHAIRMAN EMPHAISES CLEARANCE OF PENDING REFUND CASES ON PRIORITY BASIS
 

Chairman, Federal Board of Revenue, Mr. Ahmad Waqar has directed the senior tax mangers to clear all the pending refund payment cases on priority basis and due payment must be made without any further delay.

He was addressing the Directors General, Large Taxpayers Units (LTUs) & Regional Tax Offices (RTOs) at a Conference held at FBR Headquarters here today.

The Chairman said that FBR was receiving a number of complaints regarding refund payment. "We have to reduce this number to a minimal level," he said and added, "Simultaneously, we need to keep a constant check on fake refund claims so that no payment is made on fraudulent claims."

Speaking on the on-going tax reforms programme, the Chairman asked the tax officers to extend all help and support to make this programme a complete success. He said that he was watching the reforms process closely to achieve the desired results. He asked the Directors General to identify the difficulties faced by them in the system so that corrective measures are taken with immediate effect.

The Chairman asked the tax managers to share their ideas with the Board to make further progress for achieving the targets including enhancement in tax-to-GDP ratio and broadening of tax base.

Talking about the existing image of FBR, Mr. Ahmad Waqar said that we have to improve the perception of being un-friendly with the taxpayers. "Our approach should be to help and facilitate the taxpayers," he stressed.

The Chairman observed that tax collection was not an easy job and added "We have to create an environment in which the taxpayers pay the due taxes, willingly."

Earlier, Member(Direct Taxes), Mr. Irfan Nadeem briefly outlined the agenda items of today's conference which included matters pertaining to direct taxes policy, withholding taxes, direct taxes operations, recovery of arrears and revenue generation.

Later, the Chief (Tax Policy), Mr. Saeedullah briefed the participants, about the policy changes made3 in the budget.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


12th August, 2008 SALES TAX RETURNS FILING DATE EXTENDED

Federal Board of Revenue has extended the last date for filing of sales tax/federal excise returns for tax-period July, 2008 from 15th August, 2008 to 25th August, 2008.



However, due amount of sales tax & federal excise duty has to be deposited by the registered persons by 15th August, 2008.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


11th August, 2008 WORKSHOP ON E-FILING OF RETURNS TO BE HELD IN GUJRAT TOMORROW

Collectorate of Sales Tax & Federal Excise, Sialkot is arranging a follow up Seminar/Workshop at Gujrat Chamber of Commerce & Industry tomorrow at 11.00 a.m. on e-filing of tax returns.

Office-bearers and members of Gujrat Chamber of Commerce & Industry, traders and businessmen besides officers/officials of the collectorate are expected to attend the seminar/workshop in a big way.

Earlier, the Collectorate of Sales Tax & Federal Excise, Sialkot had arranged various training workshops on e-filing of returns at Sialkot and other areas of its jurisdiction. The purpose of these seminars/workshops is to crate understanding and awareness amongst the taxpayers and tax practitioners about the system, process and advantages of e-filing of returns.

It may be noted that Federal Board of Revenue has already declared e-filing of returns by all the registered persons of sales tax and federal excise, mandatory.

All Collectorates of Sales Tax & Federal Excise, established in various cities of the country, have been arranging seminars/workshop on e-filing of returns in their respective areas to facilitate the taxpayers.
 
 

-Sd-

(Muhammad Hafeez Mughal)

Secretary (PR)


9th August, 2008 WORKSHOP ON MANDATORY UNIVERSAL E-FILING OF RETURNS BY CORPORATE SECTOR


It has been made mandatory for all Sales Tax and Federal Excise registered persons to file all their returns electronically. A series of workshops/ seminars were planned to educate the taxpayers and consultants about the process of e-filing and these were also advertised in newspapers. The schedule of one such workshop, which was earlier planned to be held on Tuesday, 12th August, 2008, at Karachi Chamber of Commerce and Industry, has been changed. This workshop shall now be held on Monday, 11th August 2008, at 3.00 pm at Karachi Chamber of Commerce and Industry. All taxpayers/ consultants are requested to attend.
 

-Sd-
(Mujeeb-ur-Rehman Talpur)
Second Secretary (PR)


8th August, 2008 EXPLANATORY NOTE FOR CIRCULAR NO. 3 OF 2008

The Federal Board of Revenue has issued circular No.8 of 2008 dated 8/8/2008. Amendments have been made in the Investment Tax Scheme, 2008 announced through circular No 3 of 2008 dated 01/07/2008.

The scheme shall not apply to the cases where proceedings are pending before the department, appellate authority or any Court. Moreover, the benefits of the Scheme shall accrue to the taxpayer in terms of its Para 2 (b) for any tax year or years ending on or before 30th June, 2007.

Para 2(b) has been amended as under.

"Unexplained income/assets" means any asset for which the taxpayer has no explanation regarding nature and source and was chargeable to tax but could not be so charged under Income Tax Ordinance, 2001, for any tax year or years ended on or before 30th day of June, 2007 "

It has further been clarified that the term 'cash' as mentioned in Para A of part - I of the Annexure to the said Scheme shall include cash in foreign currency. However, for the purpose of calculation of 2 % tax payable thereon, the amount shall be converted into Pak rupee at the foreign exchange rate prevalent as on 30.6.08.

-Sd-

(Muhammad Irshad)

Chief (FATE) FBR.
 


6th August, 2008 EXPLANATORY NOTE FOR SRO 815(1)/2008 DATED 01-08-2008

To promote and regulate development of Private Pension Schemes and Funds in the country, six Pension Funds under the Voluntary Pension System Rules, 2005 have been authorized by the Security Exchange Commission of Pakistan. In order to create linkages between these Voluntary Pension Funds with the existing occupational savings schemes, the Security Exchange Commission of Pakistan proposed to allow the subscriber of a Recognized Provident Fund to transfer funds to a Voluntary Pension Fund under Voluntary Pension System Rules, 2005. For this purpose amendment in Rules 103, 104, 105 and 106 of the Income Tax Rules, 2002 have been made through this SRO.
 

 Sd-
(Khawar Khurshid Butt)
Member FATE / Official Spokesman, FBR


6th August, 2008 EXPLANATORY NOTE FOR SRO 814(1)/2008 DATED 31-07-2008

To facilitate the smooth working of the alternative dispute resolution committee it has been provided through this SRO that the place of sitting of the committee will be decided by the Chairman ADRC in consultation with the Director General, Regional Tax Office or the Director General, Large Taxpayer Unit, as the case may be.

 Sd-
(Khawar Khurshid Butt)
Member FATE / Official Spokesman, FBR


1st August, 2008 FBR has successfully surpassed the revenue target of Rs.64.4 billion by Rs. 1.6 billion during July, 2008.

FBR has successfully surpassed the revenue target of Rs.64.4 billion by Rs. 1.6 billion during July, 2008. The net provisional collection during July 2008 has been Rs. 66 billion. The recorded growth over July 2007 has been 29.7%. The performance of FBR has been broad based as all the four taxes have recorded double digit growth.

Tax wise position indicates that Direct Taxes have collected Rs. 17.3 billion, Sales Tax Rs. 31.5 billion, FED Rs 6.7 billion and collection under Customs Duty has been Rs. 10.5 billion. The figures are provisional and expected to increase further after finalization.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


26th July, 2008 FBR CHAIRMAN CALLS FOR IMPROVING TAX-TO-GDP RATIO
 


Chairman, Federal Board of Revenue and Secretary, Revenue Division, Mr. Ahmed Waqar called upon the tax machinery to gear up its efforts to improve tax-to-GDP ratio which at present was not upto the reasonable level and low even in the region.

He was addressing the senior officers of the Board at the FBR Headquarters here today.

In this regard, the Chairman directed the technical wings of FBR to study and identify the grey areas which need to be tackled effectively. "We have to improve our tax-to-GDP ratio and broaden the tax base to enable FBR to play its due role in economic development of the country", he added.

On public perception of FBR and its field offices, the Chairman stated that every possible step including improvement in the existing automated systems will be taken to root out corruption. "No compromise will be made on this issue. We have to improve our image in public," he categorically told the officials. Mr. Ahmed Waqar said that he was in favour of enforcement of tax laws but without harassment of the taxpayers.

Underlining the improvement in Board's performance, the Chairman emphasised the need to adhere to strict discipline among the FBR workforce to considerably enhance its performance and improve the image of the department amongst the stakeholders.

Chairman said that although revenue collection target of Rs. 1250 billion for current fiscal year was challenging but it will, Inshallah, be achieved with the team spirit. He told the officials that he was a pro-reforms person and played his due role in this regard wherever he served. He said that he was a strong believer of change as he believes that status-quo was not good for any institution and reforms were necessary for betterment.

Earlier, Member (FATE) & Official Spokesman of FBR, Mr. Khawar Khurshid Butt, welcomed Mr. Ahmed Waqar, on behalf of the officers of FBR & on his own behalf, on assuming the office of the Chairman and assured him all cooperation in discharging of his official duties. He also lauded the services of the out-going Chairman, Mr. M. Abdullah Yusuf during his four and a half year stay and especially for initiating the difficult task of tax administration reforms. He expressed the hope that under the able guidance of the new Chairman, FBR reforms will be completed successfully within the stipulated time.

Member (DT), Member (Customs) & Member (ST) also briefly explained to the new Chairman about their respective Wings. It was decided that detailed representations will be made by each Member separately in the next two days.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


25th July, 2008 EXPLANATORY NOTE OF SRO. 767(1)/2008

Pakistan source income of International Finance Corporation (IFC) was exempt from tax in accordance with the provisions of proviso to section 54 of the Income Tax Ordinance, 2001. The said proviso was omitted wide the Finance Act, 2008. IFC, accordingly approached the Federal Government and claimed that in view of the agreement of 1955 and the IFC Act, 1956, the Pakistan source income of IFC is exempt from tax. The claim has been considered and found correct, accordingly, Part I of the Second Schedule to the Income Tax Ordinance, 2001 has been amended and a new sub-clause (xxi) in clause (66) has been inserted therein which exempts, any Pakistan source income of the IFC. Like-wise, a new clause i.e. (67) has been inserted in Part IV of the Second Schedule to the Ordinance which provides that IFC would not be required to withhold tax while making any payment under the different sections of the Ordinance.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


12th July, 2008 ABDULLAH YUSUF CALLS FOR EFFICIENT USE OF TECHNOLOGY FOR MORE REVENUE GENERATION, ENHANCING TAX-TO-GDP RATIO


Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf has called for efficient use of modern technology for more revenue generation, enhancing tax-to-GDP ratio and expanding the tax base.

He was addressing the Workshop on Management Automation Projects held at the FBR Headquarters today. Among others, officers dealing with the automation work at field offices of FBR attended the Workshop.

Chairman stressed upon the officers to equip themselves with latest techniques and technologies. "This organisation has great potential. Once you are fully equipped with modern knowledge, techniques and technology, then it would not be difficult to achieve the desired results", he added. He was of the opinion that as an institution or country, we have to go for a better change. No country or organisation can grow and progress if it remains stagnant. We have to change ourselves with this rapid changing world to face the challenges of modern times, he opined.

Chairman said that although we were happy to cross the psychological barrier of Rs. One trillion in revenue collection in last fiscal year (2007-08) but, according to his judgement, still there was a gap of Rs. 400 bn to Rs. 500 billion exists today. This gap cannot be bridged until and unless we enhance our tax-to-GDP ratio from existing 11% to 15 / 16%. Its not impossible provided we have the will, commitment and tools to do it, Mr. Abdullah Yusuf observed. He, however, said that despite all constraints, handicaps and non-availability of necessary tools we have been able to expand our tax base in last four years form one million to 2.2 million taxpayers at the growth rate of 20% per annum.

Similarly, we have been able to enhance the revenue collection at an average of about 18% per annum. "This is good & fine but, we have to plug the existing gap". In next seven years, we have to achieve the target of 15 /16% tax-to-GDP ratio with an annual growth of atleast 0.5 %, the Secretary General added.

Commenting on the on-going automation projects, Mr. Abdullah Yusuf said that we have to realise the dream of making FBR a totally paperless organisation.

He asked the relevant officers and officials to make all possible efforts to achieve this goal.

On the occasion, the Chairman reminded FBR employees of their responsibilities towards making FBR a most progressive and efficient organisation. He added that the special treatment being given to FBR employees, in perks and privileges, by the Government was not for all times to come " We have to prove through our actions and achievements that we fully deserve for this treatment," he remarked.

Earlier, in his welcome address, Director (Projects), FBR, Mr. Muhammad Asghar Chaudhry informed that currently four pilot automation projects were in the process of development and implementation. They are; "Human Resource Management Solution (HRMS)" "Electronic Correspondence Management System (e-Dox),' "Budget & Accounts/Inventory Management System- SAP" and "e-Archiving." All these projects are at different stages of implementation at FBR Headquarters. After their completion, they will be replicated in the field offices of the Board, Mr. Chaudhry added. He said that these systems will bring transparency and efficiency in the overall administration and management system of the Board.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


8th July, 2008 PRESS RELEASE

 
Secretary General, Revenue Division/Chairman Federal Board of Revenue Mr. M. Abdullah Yusuf has called upon the businessmen, traders and industrialists to take full advantage of the newly announced amnesty scheme "Tax Investment Scheme 2008" for legalisation of their hidden assets by paying just 2% tax.

Speaking at a ceremony held in connection with formal launching of the scheme at the Islamabad Chamber of Commerce & Industy last evening, the Chairman said that the scheme is applicable for both registered and un-registered persons. On a query regarding ascertaining of the value of the hidden / undeclared assets, the Chairman said that it would be accepted on the basis of "fair market value of the assets as declared by you."

He told the ICCI members that if any one declares assets of greater value, he can take its advantage from the banks for further promotion of his business. FBR Chairman said that the amnesty scheme was a major initiative of the present Government and the business community needs to respond it in a big way. He was confident that the Islamabad Chamber, being a proposer of this scheme and a model chamber, would take lead and show 100% compliance.

Stressing on the enhancement of tax-to-GDP ratio, the Chairman underlined that we need to raise the existing ratio of 11% to 15%. Had it been the 15% tax-to-GDP ratio today, the revenue collection for the year 2007-08 would have reached to Rs. 1.4 trillion. In his opinion, there was a gap of Rs. 400 billion in revenue collection due to lower tax-to-GDP ratio.

Referring to the opportunities available in the country and the challenges faced by the business Community, the Chairman hoped that they will take all advantage of the opportunities and help to improve revenue collection and expand tax base.

On the occasion, Mr. Abdullah Yusuf also referred to the recently announced "Tax Arrears Settlement Incentive Scheme (TASIS)' of the Government which allowed the taxpayers to settle their tax arrears, including additional tax and penalty for non-payment. He hoped that the taxpayers would also take benefit of this scheme and pay their outstanding due without any penalty within the specified period.

Earlier, in his welcome address Mr. M. Muhammad Ijaz Abbasi, President of ICCI, congratulated FBR Chairman, Mr. M. Abdullah Yusuf and members of his team, for crossing the psychological barrier of Rs. One trillion in revenue collection. "This is an outstanding performance. Credit goes to Mr. Abdullah Yusuf and all of his team members," he added. He also thanked the Chairman for accepting their proposal of the amnesty scheme.

FBR's Member (DT), Mr. Usman Khalid Mirza was also present on the occasion.
 

-Sd-

(Muhammad Hafeez Mughal)

Secretary (PR)


4th July, 2008 EXPLANATORY NOTES FOR S.R.O. 713(I)/2008

Federal Board of Revenue has issued Notification (Sales Tax) / S.R.O. 713 (1)/2008 dated 3rd July, 2008. The said Notification has amended S.R.O. 647(I)/2007 dated 27th June 2007, which provides exclusions to certain sectors from the limitation as prescribed in section 8B of the Sales Tax Act, 1990. The sectors specified in the S.R.O. are not subject to limitation of input tax adjustment to the extent of 90% of output tax. Presently, following sectors are given this benefit under S.R.O. 647(I)/2007:

 

1.

Persons registered in electrical energy sector.

2.

Oil marketing companies and petroleum refineries.

3.

Fertilizers manufacturers.

4.

Manufacturers consuming raw materials chargeable to sales tax at the rate of 18.5% or 21% provided value of such raw materials exceeds 50% of value of all taxable purchases in a tax period.

5.

Wholesalers-cum-retailers operating in Chapter XII of the Sales Tax Special Procedures Rules, 2007.

6.

Commercial importers provided the value of imports subjected to 2% value addition tax under Chapter X of the Sales Tax Special Procedures Rules, 2007, exceeds 50% of value of all taxable purchases in a tax period.

7.

Person making zero-rated supplies provided value of such supplies exceeds 50% of value of all taxable supplies in a tax period.

 

Through amendment by S.R.O. 713(I)/2008, following sectors have been added to the existing list:

8.

   Distributors and wholesalers.

9.

   Gas distribution companies.

10.

   Solvent extracting units of edible oils.

 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


1st July, 2008 Explanatory notes for SRO 695(1)/2008 dated 26-06-2008
1. This SRO has been issued to reduce the pressure from e-portal and also to provide reasonable time to the taxpayers to file their Income Tax withholding statements. Earlier to this there was a same date for e-filing of monthly return of Sales tax as well as Income Tax Withholding statement and it used to slow down the whole process on e-portal on the last dates. Through SRO No.353 dated 03-04-2008, the last date of filing of withholding statement was changed to 10th of each month. But it created problem for the taxpayers as the time available to file their Income Tax withholding statement was too short. Hence the present SRO has now prescribed the new date for filing withholding statement for Income Tax as 20th of each month. The change in date of Income Tax withholding statement will ease the pressure on e-portal facilitating the taxpayer.

2. A further change has been brought and now e-filing has been made mandatory for Non-Resident ship owner and air craft owner or Charterer thereof. Both these provisions will be applicable w.e.f 1st July, 2008.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


 28th June, 2008 COLLECTION OF TAX REVENUE ON 28TH, 29TH & 30TH JUNE SBP, NBP, INCOME TAX OFFICES TIMINGS EXTENDED


In order to facilitate the taxpayers to pay their due taxes, all authorized branches of State Bank of Pakistan and National Bank of Pakistan will remain open till 6.00 p.m. on Saturday & Sunday, the 28th & 29th June, 2008 and uptill 10.00 p.m. on Monday, the 30th June, 2008.

Accordingly, all Income Tax Offices will remain open till 8.00 p.m. on Saturday & Sunday, (28th & 29th June) and till 12.00 midnight on Saturday, the 30th June, 2008. They will receive CPRs (challans) and arrange collection of tax and facilitate the taxpayers.

These measures have been taken by the Federal Board of Revenue as a part of its policy to extend all possible help and cooperation to the taxpayers in meeting their tax obligations.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)

22nd June, 2008
 
Major Amendments in Finance Bill

National Assembly of Pakistan today approved the Finance Bill for financial year 2008-09. Out of total 76 amendments, proposed by the Senate of Pakistan, 51 proposals have been accepted. The remaining 15 proposals will be duly considered during the course of the year.

Major Amendments made in the Finance Bill, passed by the National Assembly today, concerning Sales Tax & Federal Excise are as under:

  • Definition of cottage industry has been amended to provide that those manufacturers shall fall within the purview of cottage industry whose annual utility bill is below seven lac rupees and annual turnover is below Rs. Five million. Earlier the utility bill limit was six lac rupees. It may be noted that supplies of cottage industry are exempt from payment of sales tax.

  • Exemption from payment of sales tax has also been granted by amending Sixth Schedule of Sales Tax Act, 1990, to hospitals owned by federal or provincial government, hospitals of statutory teaching universities having two hundred or more beds and charitable hospitals having fifty or more beds.

  • The services of property developers and promoters have been subjected to federal excise duty by amendment in First Schedule. The development of plots shall be subject to FED at Rs. 100 per square yard and construction of residential and commercial units shall be subject to FED at Rs. 50 per square foot of covered area.

    The duty structure for cigarettes has been changed to reflect increase in prices of cigarettes. The new structure shall be effective from 22nd June 2008.


    Amendments pertaining to Customs include the reduction of import duty on sulphonic acid from 15% to 10%.


    INCOME TAX :

    Earlier, the definition of urban area for the purpose of CVT, apart from rating areas, also included the following extended areas:

    I. In respect of Karachi, 40 kms from the outer limit of rating area or Cantonment Board.

    II. In respect of Faisalabad & Lahore, 30 kms form the outer limit of rating area or Cantonment Board.

    III. In respect of other cities, 10 kms form the outer limit of the rating areas.

    Now, the urban area for the purpose of CVT has been restricted to rating areas only and the above limits have been withdrawn.

    2. In Finance Bill, a proposal was included whereby the limit of donation to charitable institutions, educational intuitions and hospitals etc were reduced from 30% and 15% to 10% of the taxable income in respect of individuals and companies. By making amendment in the Finance Bill this reduction in donation for the purpose of tax credit to a donor has been withdrawn.

    3. One time collection of Withholding Tax (WHT) on purchase of new cars has been reduced substantially. The rate of WHT on purchase of new cars will now be as under:

ENGINE CAPACITY AMOUNT OF TAX
Upto 850cc Rs. 7, 500
851cc to 1000cc Rs. 10,500
1001cc to 1300cc Rs. 16,875
1301cc to 1600cc Rs. 16,875
1601cc to 1800 Rs. 22,500
1801cc to 2000cc Rs. 16,875
Above 2000cc Rs. 50,000

       4. Exemption form Withholding Tax (WHT) in respect of the following categories of exporters   
         has been allowed:

i) Direct & Indirect exporters covered, by DTRE scheme.

ii) Goods temporarily imported into Pakistan for the purpose of re-export.

iii) Manufacturing bonds.
Further, WHT on import of cotton lint, cotton yarn, and fabrics will be subjected to 1% WHT. The anomaly has been removed by bringing it at par with five (5) zero-rated sectors in Sales Tax.


5. Earlier, the senior citizens of age 60 and above were allowed a 50% rebate on tax liability if their total taxable income was upto Rs. 400,000. This limit has been increased to RS. 500, 000 to give relief to the senior citizens.

6. Earlier fixed tax was imposed on builders and developers. Now this tax has been withdrawn as income tax and the Federal Excise duty on services of property developers and builders has been levied.

Several other changes of editorial nature have also been made on the basis of the discussion in the Parliament on the Bill.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


21st June, 2008 FBR, PNRA SIGN AGREEMENT TO COMBAT ILLICIT TRAFFICKING OF RADIOACTIVE & NUCLEAR MATERIALS

The Federal Board of Revenue and Pakistan Nuclear Regulatory Authority signed a Memorandum of Understanding today to promote cooperation and organize mutual assistance against illicit trafficking of radioactive and nuclear materials.

Member (Customs), FBR, Mr. Mahmood Alam and Member Executive, PNRA, Mr. Shakil-ur-Rehman singed the agreement on behalf of their respective organisations.

Secretary General, Revenue Division/Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf and Chairman PNRA, Mr. Jamshed Azim Hashmi were present on the occasion.

Speaking on the occasion, FBR Chairman said that Pakistan Customs was engaged in combating commercial fraud, counterfeiting drug trafficking, money laundering, electronic crime and smuggling of arms. In addition to these challenges, the growing threat of international terrorism has, now, emerged as a major concern for Customs Administrations which includes potential threat of smuggling of nuclear and radioactive materials, he added.


"This is a common threat to all countries including Pakistan which has grave implication to security," Mr. Abdullah Yusuf said and added, "Both, FBR and PNRA, recognize the need to formalize cooperation and mutual assistance to meet the possible threat of smuggling of nuclear and radioactive materials through Pakistan." As government department that controls and administers the international movement of goods, Pakistan Customs is in a unique position to contribute to the global trade supply chain security besides socio-economic development in Pakistan through revenue collection and trade facilitation. On the other hand, Mr. Yusuf said, PNRA has the technical expertise to equip and train Customs personnel for detection of radioactive and nuclear materials. Therefore, by signing this MOU, FBR and PNRA shall achieve cooperation to create an organizational framework which was needed to effectively combat the nuclear terrorism threat, he added.


FBR Chairman was the opinion that this MOU shall enhance enforcement capabilities of Pakistan Customs for preventing, detecting and responding to illicit trafficking in nuclear and other radioactive materials. It is intended to provide the framework to ensure that their illicit trafficking is prevented. He informed that Pakistan Customs has prepared an implementation plan including a Pilot Project for enforcing provisions of this MOU. Pakistan Customs is committed to achieve the objectives of this MOU as a national responsibility, the Chairman added.

Mr. Abdullah Yusuf assured that FBR shall undertake all necessary measures to provide adequate training to Customs personnel through PNRA for use of detection equipment so that all international entry and exit points are fully monitored at the earliest. He was confident that the MOU shall go a long way to bring security to this country and international community.

PNRA Chairman, Mr. Jamshed Azim Hashmi, in his speech, said that both FBR and PNRA will cooperate with each other to meet international obligations to combat illicit trafficking of radioactive and nuclear materials. He assured all support to FBR to make the borders secured.

The MOU, signed today, explains that the world today is facing a growing international threat of illicit trafficking of radioactive and nuclear materials which present a grave hazard to national and international security. The Government of Pakistan recognizes its international obligations to join global efforts to combat threat of illicit trafficking of radioactive and nuclear materials.

Pakistan Customs is the primary enforcement agency at international entry and exit stations including international airports, dry ports among other Customs stations while PNRA is the national statutory nuclear regulatory authority in Pakistan entrusted with the task to regulate all aspects of application of ionizing radiations and nuclear energy in Pakistan, Therefore, the two organizations have entered into agreement for cooperation in joint measures for detection, and subsequent management, of radioactive and nuclear materials at strategic points. The necessary detection equipment has been procured by PNRA which shall be handed over to Pakistan Customs after training of the Customs personnel. This equipment shall be used by Pakistan Customs at sea ports, dry ports, airports and at any other Customs station at international border or for goods in transit or in transshipment or the goods en route throughout territory of Pakistan.

Under this MOU, PNRA shall provide the Pakistan Customs training, technical assistance and maintenance facilities for radiation detection equipment and radiation protection, management of radioactive/contaminated consignments while both shall cooperate to manage radioactive sources/materials identified or seized/confiscated by the Pakistan Customs.


It has been agreed that Pakistan Customs in association with PNRA shall run a pilot project at Islamabad International Airport for comprehensive enforcement model for Customs controls including monitoring/detection of radioactive/nuclear materials. This model shall be applied to all other international airports by the Pakistan Customs for effective and modern enforcement controls after completion of the pilot project.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


10th June, 2008
 
FBR HELPLINE TIMINGS EXTENDED

It has been decided that FBR Helpline will remain open from 09.00 A.M. to 09.00 P.M. from 11th to 30th June, 2008 to facilitate the taxpayers regarding their queries about taxation measures / changes in respect of Income Tax, Customs, Sales Tax and Federal Excise proposed in the Federal Budget 2008- 2009.
Officers and staff will be available at FBR Helpline to answer queries on budgetary measures immediately after the conclusion of Budget Speech. Taxpayers can seek help and assistance at FBR’s Toll-Free Help line number 0800-00 227 and 051-111-227-227. FBR’s website www.fbr.gov.pk  is also accessible for free downloading of Budget 2008-2009 after the conclusion of Budget Speech on 11th June 2008.

- Signed-
(Khawar Khurshid Butt)
Member. FATE / Official Spokesman, FBR


9th June, 2008 Explanatory notes for SRO 522(1)/2008 dated 09-06-2008
This SRO has been issued to reduce the pressure from e-portal and also to provide reasonable time to the taxpayers to file their Income Tax withholding statements. Earlier to this there was a same date for e-filing of monthly return of Sales tax as well as Income Tax Withholding statement and it used to slow down the whole process on e-portal on the last dates. There through SRO No.353 dated 03-04-2008, the last date of filing of withholding statement was changed to 10th of each month. But it created problem for the taxpayers as the time available to file their Income Tax withholding statement was too short. Hence the present SRO has now prescribed the new date for filing withholding statement for Income Tax as 20th of each month. The change in date of Income Tax withholding statement will ease the pressure on e-portal facilitating the taxpayer.

-Sd-
Usman Khalid Mirza
Member (Direct Taxes)


2nd June, 2008 SUBJECT: FBR HAS SURPASSED THE REVENUE TARGET SET FOR MAY 2008.

FBR has surpassed the revenue target of Rs. 84.8 billion assigned for May 2008.

2. The provisional tax collection for May 2008 has achieved an overall growth of 30.3%. The net collection during May 2008 has been Rs. 86 billion against Rs. 66 billion during May 2007. The revenue on account of direct taxes has risen from Rs. 20 billion last May to Rs. 24.1 billion in May 2008 reflecting a growth of 20.3%. The sales tax collection has jumped to Rs. 38.5 billion as against Rs. 27.4 billion of last May showing a growth of 40.3%. While sales tax on import stage has increased by 16.8%, the increase in the domestic component is 76%. The collection of federal excise duties has increased by 15.9%, increasing from Rs. 7.3 billion to Rs. 8.5 billion. Finally, a healthy growth of 33.3% has been recorded in the collection of customs duties where the net receipts have reached Rs. 14.9 billion against Rs. 11.2 billion of last May.

3. The July – May collection of FBR now stands at Rs. 849.6 billion as against Rs. 722.5 billion of corresponding period of last year showing an overall growth of 17.6%.

4. The provisional figures for the month of May are expected to increase further during the next few days.

-Sd-
(Khawar Khurshid Butt)
Member (FATE)
Official Spokesman of Federal Board of Revenue
Dated: 02-06-2008


2nd June, 2008 FBR PROMOTES 111 CUSOTMS OFFICIALS AS DY. SUPERINTENDENT
 
Federal Board of revenue has approved the promotion of 111 Customs Inspectors/Stenotypists, working in BS 11/12, as Dy. Superintendent (BS-14).
A meeting held under the chairmanship of Member (Admn), Maj.Gen. (Retd.) Muhammad Yasin has given final approval to the recommendations of the Department Promotion Committee (DPC) which met earlier in this regard. The DPC was presided over by the Collector, Sales Tax, Lahore.
Earlier, FBR had promoted 63 Income Tax Inspectors as Income Tax Officers, about a month back.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


17th MAY, 2008 EXTENSION IN DUE DATE FOR ELECTRONIC FILING OF SALES TAX-CUM-FEDERAL EXCISE RETURN FOR THE TAX PERIOD APRIL 2008 BY PERSONS REGISTERED IN LTU, Karachi.

The taxpayers registered with Large Taxpayers Unit, Karachi, are now required to file returns through FBR’s e-portal and the previous system of filing returns through Banxis has been discontinued. Because of difficulties anticipated in transition from e-filing on Banxis to e-filing on FBR’s e-portal, the Federal Board of Revenue, through ST Circular 03/2008 has extended the due date for electronic filing of sales tax-cum-federal excise return and invoice summary statements for the tax period April 2008 from 15th May to 20th May, 2008, for registered persons falling in the jurisdiction of Large Taxpayers Unit, Karachi.

-Sd-
(Hameed Memon)
Secretary ST-L&P FBR


11th MAY, 2008 New device more efficient Tax Management System Renamed as ‘Mahassal’
(BUSINESS RECORDER DATED 11th MAY, 2008)

ISLAMABAD: The Federal Board of Revenue (FBR) has renamed the ‘Tax Management System’ (TMS) as ‘Mahassal’ for speedy implementation of a homegrown system covering all income tax-related functions, including returns analysis, assessment and verification processes.

Sources told Business Recorder on Saturday that if the ‘Mahassal’ system failed in proper computerization of direct taxes, the whole project of automation and integration of taxes would suffer a serious set-back under the reforms.

The ‘Mahassal’ team, headed by Project Director Ranna Ahmed, recently met FBR Chairman Abdullah Yusuf to give a demonstration on the new system.

There were some misunderstandings between the ‘Mahassal’ development team from Lahore and tax officials at the FBR. However, the FBR Member, Taxpayer Education and Facilitation, Khawar Khurshid Butt, took the initiative for bridging the communication gap between the ‘Mahassal’ team and the FBR officials.

During 5-6 hours presentation, it was decided that the ‘Mahassal’ would be made part of the reform process to declare it as a key initiative for direct taxes automation. The FBR agreed to declare ‘Mahassal’ as a project under the reform agenda.

The project would be an end-to-end solution to all direct taxes related operations and maintenance of tax records. The project would cover documentation of income tax returns, calculation of taxes, raising demands, issuance of computerized notices, appeal system, taxpayer ledger and balance system and other operations of direct taxes side.

The original project i.e. TMS was not functioning properly due to lack of facilities and support to the ‘Mahassal’ team in Lahore. Practically, the TMS was not functioning error-free for the last few months. This prompted the team to revamp the entire system under a new name i.e. ‘Mahassal’ by applying new methodology with the help of FBR.

Moreover, the Pakistan Revenue Automation Limited (PRAL) wanted to maintain its monopoly by installation of computerized system through its own experts.

On the other hand, project development team informed the FBR that the software would be almost free of cost as compared to expensive computer systems being purchased from advance countries.

Sources said that the ‘Mahassal’ team is working at Lahore without any proper support or funding creating problems for implementation of the project. As a pilot project, the ‘Mahassal’ is being tested at the Large Taxpayers Unit (LTU), Lahore, for processing of income tax data of around 224 top business entities.

When the testing is successful, the system would be replicated at other LTUs and reformed units across the country.

To accomplish the task, the FBR Chairman has directed the concerned departments to provide necessary accommodation, resources, computer servers and infrastructure to the ‘Mahassal’ development team in Lahore.

Sources said that the project team requested the FBR Chairman to develop a new web-based E-portal for directly collecting data of income tax returns under the ‘Mahassal’. The team has found that the existing income tax returns information on E-portal is not error-free, which pointed towards developing a new web-based system.

However, the representatives of PRAL argued why a separate E-portal was required in the presence of an E-portal already collecting income tax returns. The FBR Chairman directed the foreign consultant to provide necessary information of both E-portals to the experts. It would be decided whether ‘Mahassal’ proposed E-portal is better or not.

The project director demanded filing of returns electronically through their proposed E-portal on experimental basis. This would allow the ‘Mahassal’ to directly upload the income tax returns on the system for further analysis. Presently, taxpayers are still facing problems in filing returns, electronically through the existing E-portal.

Sources said that the apprehensions of the project team were removed and the system would be given due attention of the board for its implementation countrywide.

FBR Chairman also directed the project team to ensure cleaning of income tax data which is necessary for implementation of any integrated system.


10th May, 2008 VISUAL/PICTORIAL COVERAGE OF PRE-BUDGET SEMINAR
Federal Board of Revenue, in collaboration with Federation of Pakistan Chambers of Commerce & Industry, is organising a Pre-Budget Seminar at National Library Auditorium (behind PM Secretariat), Islamabad on 12th May, 2008 (Monday) at 10.30 a.m.

Federal Minister for Finance, Revenue, Economic Affairs & Statistics Mr. Muhammad Ishaq Dar will be the Chief Guest while Chairman, FBR, Mr. M. Abdullah Yusuf will preside the Seminar.

All accredited Economic Correspondents, TV channels & Press Photographers are cordially invited to cover the Seminar.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


7th May, 2008

 FBR ARRANGES PRE-BUDGET SEMINAR ON 12TH MAY  

Federal Board of Revenue, in collaboration with Federation of Pakistan Chambers of Commerce & Industy, is organising a Pre-Budget Seminar on 12th May, 2008 here at National Library Auditorium.

Federal Minister for Finance, Revenue, Economic Affairs & Statistics, Mr. Muhammad Ishaq Dar will be the Chief Guest. Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf will preside over the Seminar.

Seminar will be held two sessions. Inaugural Session will be addressed by the Chief Guest, Mr. Muhammad Ishaq Dar. Besides, President, FPCC&I, Mr. Tanvir Ahmed Sheikh and President, SAARC Chamber of Commerce & Industry, Mr. Tariq Saeed will also address the participants in the same session. Earlier, FBR Chairman Mr. M. Abdullah Yusuf, in his address of welcome, will outline the objectives of holding the Pre-Budget Seminar.

In working Session of the Seminar, representatives of industry & trade will present their budget proposals. Member (FR&S), FBR, Dr. Ather Maqsood, will also give his presentation. Secretary General, Revenue Division/Chairman, FBR, Mr. M. Abdullah Yusuf, will conclude the Seminar by his address to the participants.

Prominent businessmen, traders and industrialists across the country office-bearers and members of the FPCC&I and other chambers, high ranking officials and senior tax mangers are expected to largely attend the Seminar.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


7th May, 2008 Explanatory Notes for SRO 410(I)/2008
To implement the ECC decision regarding revision of salaries of Airport security force (ASF), The proposed rates have been incorporated in FED rates on Air Travel vide SRO 410(I)/2008 dated 29th April, 2008.

-sd-
Mehmood Alam
Additional Secretary


2nd May, 2008 Explanatory Notes for SRO 406(I)/2008
The import and supply of CKD kits of single cylinder agriculture diesel engines of 3 to 36 HP are exempt from sales tax. In order to exempt the supply of finished product i.e. single cylinder agricultural diesel engines (3 to 36 HP) this notification has been issued so that the same is available to farmers on competitive prices. This step would facilitate the farmers who use agricultural diesel engines for farming activities.

-sd-
Mehmood Alam
Additional Secretary


30th April, 2008 FBR HAS SURPASSED THE REVENUE TARGET SET FOR APRIL 2008.
1. FBR has surpassed the revenue target of Rs. 74.3 billion assigned for April 2008.

2. The provisional tax collection for April 2008 has achieved an overall growth of 26.2%. The net collection during April 2008 has been Rs. 75.1 billion against Rs. 59.5 billion during April 2007. The revenue on account of direct taxes has risen sharply from Rs. 15.1 billion last April to Rs. 23.8 billion in April 2008 reflecting a growth of 57.7%. The sales tax collection has jumped to Rs. 31.4 billion as against Rs. 27 billion of last April showing a growth of 16.5%. While sales tax on import stage has decreased by 7.6% due to zero-rating of crude oil, the increase in the domestic component is 48.6%. The collection of federal excise duties has increased by 10.1%, increasing from Rs. 7 billion to Rs. 7.7 billion. Finally, a healthy growth of 16.8% has been recorded in the collection of customs duties where the net receipts have reached Rs. 12.2 billion against Rs. 10.4 billion of last April.

3. The July – April collection of FBR now stands at Rs. 755 billion as against Rs. 656.5 billion of corresponding period of last year showing a growth of 15%.

4. The provisional figures of April are expected to increase further during the next few days.
 

-Sd-
( Khawar Khurshid Butt )
Member (FATE)
Official Spokesman of
Federal Board of Revenue


30th April, 2008 SRO 408(I)/2008 EXPLAINED
SRO 408(I)/2008 dated 29.04.2008 amends the Chapter X of Sales Tax Special Procedures Rules, 2007, which prescribes the procedure for payment of sales tax by steel melters and re-rollers. This chapter requires that sales tax from steel melters and re-rollers shall be collected on the basis of electricity consumption at Rs. 4.75/ KWH.

However, Pakistan Steel Mills and Peoples Steel Mills have been excluded from purview of payment on the basis of electricity consumption and have to pay sales tax in normal VAT mode. Similar exclusion was requested by M/s. Heavy Mechanical Complex (HMC) who also intend to supply ingots and billets besides other products manufactured by them.

Since, the tax at Rs. 4.75/KWH is meant for units exclusively manufacturing ingots, billets and other long re-rolled products, therefore, SRO 408(I)/2008 amends the rules to provide similar exclusion for HMC as is available to Pakistan Steel Mills and Peoples Steel Mills.

 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


29th April, 2008 63 INSPECTORS PROMOTED AS INCOME TAX OFFICERS

 Federal Board of Revenue today approved the promotion of 63 Inspectors of Income Tax Department from BS-11 & 14 to BS-16 as Income Tax Officers.

The approval was given at a meeting of the Departmental Promotion Committee held under the chairmanship of the Member (Admn) of FBR, Maj. Gen. (Retd.) Muhammad Yasin.

This is after a long time that such a huge number of Inspectors have been promoted as Income Tax Officers.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


25th April, 2008
 
ABDULLAH YUSUF URGES TAX MANAGERS TO GEAR UP EFFORTS TO MAXIMIZE REVENUE GENERATION RS. 257.6 BILLION DIRECT TAXES COLLECTED IN 9 MONTHS


Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf has called upon the tax managers to gear up their efforts to maximise revenue generation.

He was addressing the Directors General of Regional Tax Offices & Large Taxpayers Units, Commissioners of Income Tax & Commissioners (Appeals) at 17th National Tax Conference, held here today under the auspices of FBR.

Mr. Abdullah Yusuf identified various grey areas from which the full revenue potential is yet to be tapped. He also underlined the need of plugging the revenue leakages to improve direct taxes collection.

Earlier, Member (Direct Taxes), Mr. Usman Khalid Mirza, in his presentation, briefed the Conference about the overall performance of the Wing and its field formations. Collection upto March 08 was Rs. 257.6 billion as against Rs. 237.8 billion in the corresponding period of last year.

While discussing the performance, the Member (DT) pointed out the gaps in various areas. He stressed upon bridging these gaps. He exhorted the tax officers to pay attention on monitoring of withholding taxes, Creation and Collection out of Demand and other avenues to enhance revenue collection.
The Conference, during its deliberations, discussed and took decisions on strategy for achieving the revenue targets, disposal of pending refunds claims, recovery of arrears and the issue of tax exemptions. Conference also reviewed the progress in data entry of returns and annual employer’s statements and deliberated on achievements of targets in remaining period of the current financial year.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR


26th April, 2008 Explanatory Notes for the SRO 371(I)/2008
Some amendments have been made in Federal Excise Rules, 2005 vide SRO (I)/2008 dated 14th April, 2008 to incorporate the provision of debit credit notes and harmonize return filing with that of sales tax return omitting special FED returns.

-Sd-
Rizwan Salabat
Second Secretary Tariff
(ST 7 FE)


25th April, 2008 PRESS RELEASE

The sales of automobile industry (Local Car Manufacturers) had gone down considerably in the beginning of this year due to the power and political crises in the country and the exchequer was suffering huge losses on account of customs duty and sales tax. In order to safeguard, the revenue, the withholding tax @ 2.5% under section 231B (Advance and Adjustable) collected by the manufacturers or authorized dealers of motor car at the time of sale of motor car was suspended, initially for a period of two months i.e. February 21 to April 20, 2008. This temporary suspension of withholding tax gave good results in the shape of increase in sales of cars and consequently the Government revenue on account of collection of sales tax and customs duty also increased in March 2008 as compared to February 2008.

In view of increase in collection of customs duty and sales tax, the Government decided to extend the period of suspension of collection of advance withholding tax @ 2.5% collectable from the buyers of local motor cars upto June 30, 2008 through Notification S.R.O. No. 383(1)/2008 dated April 21, 2008.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


24th April, 2008 LOCAL MANUFACTURE OF AGRICULTURAL DIESEL ENGINES (SINGLE CYLINDER OF 3-36HP)

The Agricultural Diesel Engines Manufacturers Group requested the Federal Board Revenue to enhance the existing range of Agriculture Diesel Engines (Single Cylinder) from “12-32 HP” to “3-36 HP” in terms of serial number 94 of SRO 565(1)/2006 dated 05.6.2006 on the basis that Single Cylinder Diesel Engines of 3HP to 36HP has been declared as manufactured locally vide CGO No. 18/2007 dated 29.12.2007.

The request was examined in consultation with the Ministry of Food, Agricultural and Live Stocks (MINFAL) and the Engineering Development Board (EDB). A consensus was evolved to accede the request of the Agricultural Diesel Engines Manufactures Group and thereby to allow the import of CKD Kits of Agriculture Diesel Engines (Single Cylinder 3-36 HP) at 10% concessionary rate of duty.

Accordingly, a notification SRO 384(1)/2008 dated 21st April, 2008 (Annex-I) has been issued enhancing the existing range of CKD Kits of Agriculture Diesel Engines (Single Cylinder) from 12-32 HP to 3-36 HP under SRO 565(1)/2006 dated 05.6.2006. Thereby, the CKD Kits will be importable at 10% concessionary rate of duty for manufacture of said engines. The notification dated 21st April, 2008 is effective from 29th December, 2007 i.e., the date on which the CGO No. 18/2007 had been issued.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


24th April, 2008 E-FILING OF SALES TAX RETURNS MANDATORY FROM 1ST JULY

Quarterly Conference of Collectors of Sales Tax & Federal Excise & Collectors (Appeals), held here today under the chairmanship of the Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf, has decided to make e-filing of sales tax returns mandatory from 1st July, 2008.

During the Conference, it was informed that total sales tax collection in first nine month of current financial year (July-March) was Rs. 258.4 billion as compared to Rs. 218.4 bn in the corresponding period of the last financial year, showing an increase of Rs. 40 billion.

Major sectors which have shown positive growth as compared to last year were Telecom (24.6%), POL (48.9%), Natural Gas (4.3%), Sugar (1.3%), Cigarettes (18.4%), Services (20.3%), Aerated Waters/Concentrate of beverages (24.9%), Iron & Steel (112.2%) etc.
In federal excise, the total collection from July 2007 to March, 2008 (9 month) was Rs. 61.8 billion as compared to Rs.47.72 billion in the same period last year, indicating an increase of Rs. 14.08 billion. Major revenue spinners showing positive growth were Cigarettes (18.94%), Natural Gas (8%), Services (252%) etc.
Speaking on the occasion, the Chairman called upon the Collectors to intensify their efforts to enhance revenue collection. In this regard, he emphasised on conducting sectoral research to identify the gap between the revenue potential existing in various sectors of the country and the taxes they were actually paying. We have to narrow down this gap to enhance the sales tax and federal excise collection. To achieve this objective, we need to implement a comprehensive strategy, he added.

Talking on the issue of sales tax refund claims, the Chairman stressed the need of removing all the bottlenecks confronting the system to deal with the issue in an effective manner. “We must know what is actually to be paid”, he remarked.

He, however, underlined the need of clearly identifying the level & type of the refund problem. All genuine refund claims must be cleared after due verification by the system and all efforts must be directed towards narrowing down the issue, Mr. Yusuf emphasised.

Commenting on automation systems, currently operating in various FBR offices, the Chairman emphasised that all these systems must be effective, reliable and productive and give the desired results. “Incompleteness of the automated systems creates problems”, Mr. Abdullah Yusuf observed.
Revenue impact of new budgetary measures, taken in the last budget, was also reviewed during the Conference and termed it satisfactory. Budget proposals for the year 2008-09, measures for expeditious feeding of sales tax returns, recovery of arrears, audit performance of collectorates adjudication pendency etc. also came under discussion and necessary decisions were taken.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


 24nd April, 2008 RTO KARACHI SHOWS ENCOURAGING FIGURES UP TO MARCH, 2008

The Regional Tax Office, Karachi has shown a remarkable performance as evidenced by the achievement of revenue targets up to the month of March, 2008. Collection out of current and arrear demand stands at Rs. 2126.859m as against Rs. 1202.463 m last year showing a 77% increase as against the collection up to march last year whereas collection of tax at source has also registered a 24% increase as compared to last year with the latest figures at Rs. 55596.061 m. Net Income Tax collection shows an encouraging 19% rise at Rs. 60111.211 m as opposed to last year figures for the month of March at Rs. 50531.917 m. On the whole the total collection including all heads plus CVT and WWF is also in the positive range depicting 17% increase compared to the previous year. The short fall being face under the heads of voluntary compliance i-e: Advance Tax and Payment with returns is being covered with a 5.631b amount to be remitted by the customs authorities under the head “Imports” during the third quarter.

-Sd-
Shazia Abid
DCIT/TO
RTO, Karachi


 22nd April, 2008 GEN. YASIN APPOINTED CHIEF CO-ORDINATOR FOR REVENUE BUDGET 2008

Federal Board of Revenue has appointed Maj.Gen. (Retd.) Muhammad Yasin, Member (Admn), FBR, as Chief Coordinator for the Revenue Budget-2008, according to an office order, issued by the Board.
Mr. Saeed-ur-Rehman, Chief (Management), FBR, has been appointed Coordinator and Mr. Saeed Iqbal, Chief (Admn.) & Mr. Mahmood Hussain, Secretary(S&M) have been appointed Chief Security Officer & Dy. Chief Security Officer respectively for the Revenue Budget 2008.
All these appointments have been made with the approval of the Acting Chairman, FBR, Mr. Usman Khalid Mirza.

 
-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)

19th April, 2008
 
PRESS RELEASE


A 46-member group comprising officers of the senior Management Course of National Management College, Lahore, currently on inland study tour, today visited Federal Board of Revenue and remained there for some time.

During the visit, the course participants were briefed by the Official Spokesman & Member, Facilitation & Taxpayers Education of FBR, Mr. Khawar Khurshid Butt on the on-going tax Administration Reforms Programme. He informed the participating senior officers that the total cost of the programme has been estimated as $ 149 million which was funded by the World Bank, DFID and Government of Pakistan. He said, three Large Taxpayers Units, 12 Regional Tax Offices, Model Customs Collectorates and 65 Tax Facilitation Centres have been established for the facilitation of the taxpayers under TARP.

The Spokesman said that the results of the Programme so far achieved were very encouraging in terms of increase in revenue collection, facilitation of the taxpayers, reducing cost of dong business, minimizing interaction between the tax collectors and taxpayers, reducing the level of corruption, attracting foreign investment etc. He said the revenue collection which was in the vicinity of Rs. 300 billion few years back was reached at Rs. 846 bn in 2006-07.

Later, the spokesman answered the questions of the course participants.
 

-Sd-

(Muhammad Hafeez Mughal)

Secretary (PR)


18th April, 2008 FBR AMENDS S.R.O. 330 (1)2008 TO CHECK SMUGGLING INTO ALL NEIGHBORING COUNTRIES
 

Federal Board of Revenue has amended its Notification S.R.O. 330(1)/2008, dated 31-03-2008 to improve the vigilance on the possible smuggling of rice, pulses of all sorts, wheat and wheat products into all neighboring countries. Previously, these powers were restricted to check smuggling into Afghanistan only.

The powers will remain delegated to Frontier Corps (NWFP and Balochistan) and Pakistan Rangers (Punjab and Singh) till 15.5.2008.

-Sd-

(Muhammad Hafeez Mughal)

Secretary (PR


10th April, 2008 Explanatory notes for SRO 353(I)/2008 dated 03.04.2008
This SRO has been issued to reduce the pressure from e-portal as there was a same date for e-filing of monthly return of Sales tax as well as Income Tax Withholding Statement and it used to slow down the whole process on last dates. The change in date of withholding statement will ease the pressure on e-portal facilitating the taxpayer.

sd-
Usman Khalid Mirza
Additional Secretary


5th April, 2008 Explanatory notes for SRO 337(I)/2008 dated 02.04.2008
This SRO has been issued to fix the assessable value of sugar for sales tax purposes from Rs. 21/- to Rs. 19/- per kg as the wholesale price of sugar has gone down from Rs. 25.40 to Rs. 23.40 per kg. In order to rationalize the tax burden, the assessable value of sugar has been decreased. This step would facilitate the consumers and ensure the availability of sugar on normal price.

sd-
Asif Abbas
Second Secretary (ST-Budget)


5th April, 2008 CUSTOMS DUTY ON PHOSPHATE ROCK EXEMPTED
The Federal Government has exempted 5% customs duty on phosphate rock, ground, PCT heading 2510.2000 by issuing SRO 333 dated 02-04-2008 amending SRO 567(1)/2006 dated 05-06-2006.

This measure has been taken to mitigate difficulties being faced by the fertilizer manufacturers in the country. It will also help reduce the cost of production of this sector which will in-turn help stabilize prices of fertilizer in the country.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


3rd April, 2008 PRESS RELEASE

Federal Minister for Finance Mr. Ishaq Dar visited FBR Headquarters today and was given a detailed briefing by Mr. M. Abdullah Yusuf, Secretary General Revenue Division / Chairman FBR on the current revenue position and future scenario. A brief résumé of Tax Administration Reforms Program (TARP) was also given. The briefing was also attended by all Board Members and CEO Pakistan Revenue Automation Limited (PRAL). Chairman, FBR apprised the Minister of the plan to enhance Tax to GDP ratio by 5% over next 10 years. He focused on the reform efforts being under-taken by FBR with particular emphasis on improvement in systems and procedures through the help of technology in order to ensure that FBR becomes an efficient and transparent organization.

Mr. Ishaq Dar lauded the efforts of the Federal Board towards collection of higher targets of revenue and emphasized the need to ensure transparency in the system and to provide maximum facilitation to the tax payers at all levels. He also stressed the need to provide adequate incentives to the Agricultural Sector so as to achieve food security for the country.

Mr. Dar emphasized the need for introduction of measures in the forthcoming budget that would lead to introduction of an equitable system of tax wherein relief is provided to the poorer classes. He stressed the need for balancing the fiscal and monetary policy which, due to mismanagement in the past, had resulted in distortions in the economy. The Finance Minister also required of the Federal Board to remove anomalies in taxation system.

The Federal Finance Minister also urged the Board Members to formulate policies for the forthcoming budget in consonance with the aspirations of the people and agenda of the popularly elected government.
 

(Khawar Khurshid Butt)
Member (FATE)
Spokesman of the Federal Board of Revenue.
3rd April, 2008


April 03,2008 FBR Revenue Collection during and up to March 2008
The July – March collection of FBR has reached Rs. 678.9 billion as against Rs. 597 billion during the corresponding period of last year showing a growth of 13.7%. With this achievement, the overall growth in collection has improved by 1.2% points as July-February growth was 12.5%. The tax-wise three-quarter growth is as follows: Direct Taxes 8.4%, Sales Tax 17.8%, Federal Excise Duties 29.1%, and Customs Duties 9.9%.

2. The provisional tax collection for March 2008 has recorded an overall growth of 13.1%. The net collection during March 2008 has been Rs. 92.6 billion against Rs. 82 billion during March 2007. The revenue on account of direct taxes has risen modestly by 3% going up from Rs. 38.9 billion last March to Rs. 40 billion in March 2008. The sales tax collection has been Rs. 29.7 billion as against Rs. 24.1 billion of last March showing a growth of 23.4%. While sales tax on import stage has increased by 8.6%, the increase in the domestic component is 44.3%. The collection of federal excise duties has increased by 26.7%, increasing from Rs. 6 billion to Rs. 7.6 billion. Finally, a healthy growth of 17.5% has also been recorded in the collection of customs duties where the net receipts have reached Rs. 15.3 billion against Rs. 13 billion of last March.

3. The provisional figures of March are expected to increase further during the next few days.
 

Sd-
( Khawar Khurshid Butt )
Member (FATE)


April 03,2008 Achieving sustainable development-‘Change Management’ in the FBR.
 

31 March, 2008 Explanatory Notes of SRO 329(I)/2008
The Notification has been issued to facilitate solvent extracting units whereby they will be able to adjust 100% input tax paid on their purchases. As per section 8B of the Sales Tax Act, 1990, a taxpayer can adjust 90% of input tax paid on his purchases against his output tax. As the value addition in solvent extraction units is not high enough such a provision was resulting into refunds. To save solvent extraction units from cash flow problems, they have been allowed to adjust 100% input tax paid on their purchases.

SD-
(Asif Abbas)
Second Secretary (ST-Budget)

 

1st April, 2008 Explanatory Notes of SRO 326(I)/2008
The Federal Government has issued a SRO 326(I)/2008 dated 29.03.2008 whereby exemption from the whole of customs duties, sales tax and federal excise duty leviable on all the goods imported into and exported from an Export Oriented Unit subject to the provisions of the Export Oriented Units and Small and Medium Enterprises Rules, 2008 has been granted.

-Sd-
(Kahlid Mahmood)
Second Secretary (Export Policy)


1st April, 2008 Explanatory Notes of SRO 327(I)/2008

Federal Board of Revenue has announced a Scheme of Export Oriented Units vide Notification No. 327(I)/08 dated 29.03.2008. Under the scheme raw materials and plant, machinery, equipment and apparatus, including capital goods to be used solely within the limits of an Export Oriented Units can be imported free of customs duty, sales tax and federal excise duty. The scheme will essentially have the same incentive as are available to units in EPZs.  Existing units exporting at least 80% of production to be registered with FBR under the scheme. New units, so register, will be required to export 100% of their production. Under this scheme time limit for consumption of duty free locally purchased/imported raw materials is two years.

 

Sd-
(Kahlid Mahmood)
Second Secretary (Export Policy)


1st April, 2008 FBR EMPOWERS FC, RANGERS TO CARRY OUT ANTI-SMUGGLING FUNCTION TILL 15TH MAY

Federal Board of Revenue vide a Notification (Customs) dated 31-03-2008 has authorized the Frontier Corps (NWFP and Balochistan) and Pakistan Rangers (Punjab and Sindh) to carry out anti-smuggling functions within their respective jurisdictions. The powers have been delegated under the Customs Act in order to endure a greater vigilance on the possible smuggling of rice, pulses of all sorts, wheat and wheat products into Afghanistan.
The powers will remain delegated to Frontier Corps (NWFP and Balochistan) and Pakistan Rangers (Punjab and Sindh) till 15th May, 2008.

 
27th March, 2008 Explanatory notes for SRO 315(I)/2008 dated 27.03.2008
The notification amends the Sales Tax Special Procedures Rules, 2007, to provide as under:

(i) Previous exemption from registration for CNG stations has been waived. Now, CNG stations shall obtain registration, if not already registered, and shall also file return on quarterly basis. It may be noted that tax on CNG on behalf of CNG stations is paid by gas distribution companies i.e. SNGPL and SSGC. Their supplies to CNG stations are charged at 24% of value instead of normal rate of 15%.

(ii) The scope of tax on advertisement has been clarified by providing meaning of the expression “taxable services” of advertising. The scope covers all advertisements which are:

(a) broadcast or telecast by TV or radio stations based in Pakistan;
(b) booked in Pakistan for broadcasting or telecasting on TV or radio stations based abroad, whether or not possessing landing rights in Pakistan; and
(c) transmitted on closed circuit T.V. or cable T.V. network.”
 

-Sd-
(Hameed Memon)
Secretary


25th March, 2008 Press Release
A meeting of Departmental Development Working Party (DDWP) which held at the Federal Board of Revenue today under the chairmanship of Member (Administration) approved 32 development schemes at the total cost outlay of Rs. 584 million.

Representatives of the Reformed Units from all the provinces alongwith officers from Planning Commission, Ministry of Finance and Pak. PWD attended the meeting.

Purpose of the meeting was to consider and approve various projects relating to the offices and residential accommodation of the officers and staff of FBR as a step forward towards 05 Years Infrastructure Development Plan of the Admn Wing of FBR HQ.

The Admn Wing is carrying out comprehensive and concerted efforts to improve offices of the field formations and also provide suitable residential accommodation to the officers and staff of Income Tax, Customs, Sales Tax & Federal Excise departments.

Out of 35 schemes presented before the DDWP, 32 were approved at the total cost outlay of Rs.584 million. The schemes included construction of various offices which are currently housed in rented premises and construction of residential units for the officers and staff of FBR.

Another meeting of similar nature is being scheduled in the first week of April, 2008. These steps are taken as a part of the Reform Process of FBR in order to increase efficiency and dedication of its officers and staff.

 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


25th March, 2008 Press Release
Secretary General, Revenue Division/ Chairman Federal Board of Revenue, Mr. M. Abdullah Yusuf said that the security of official buildings and documents was a very critical and important issue today which needs to be addressed through effective use of technology and modern security equipments.

He was addressing the concluding session of one-day Workshop on Security Systems held under the auspices of Admn. Wing of FBR. All Chief Security Officers of FBR's field formations attended the Workshop.

The Chairman said that the Board's decision to improve the security of its offices was mainly due to the prevailing situation which demands fool-proof arrangements for the security of the Board and its units and safety of their employees as well as the visitors.

Mr. M. Abdullah Yusuf said that all the security personals need to be vigilant and properly trained. They must ensure that the visitor was going to only that office/ floor where he was authorised to go. He advised the participants to act in a professional manner so that the taxpayers feel secure and comfortable while visiting Board's reformed units. "We need to create and maintain the security of a high standard," he added.

Earlier, Member (Admn) Maj.Gen. (Retd) Muhammad Yasin, speaking on the occasion, advised the security officers to ensure that all necessary security equipments like walk-through gates, scanners, barriers etc. made available at their offices were fully operational.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


25th March, 2008 Explanatory Notes for SRO 307(I)/2008
 
  SRO amends the Sales Tax Rules, 2006, with following objectives:

(i) To provide for refund of excess input tax in cases other than those of zero-rated supplies. The refund against zero-rated supplies has been provided in section 10 of the Act. The procedure for refund in other cases had not been prescribed. The same has been done through this amendment.

(ii) To provide for single return, in cases where a registered person operating in different sectors was required to file multiple returns because of different due dates for filing of return for each of the sectors. Now he shall file a single return for all such sectors by the due date applicable to his major activity in terms of sales tax or federal excise duty payable.
 
 

-Sd-
(Hameed Memon)
Secretary


25th March, 2008 Explanatory Notes for SRO 308(I)/2008
 
SRO prescribes rate of refund to steel melters and steel re-rollers against exports. Since, steel melters and re-rollers operate under special procedure whereby the tax on the basis of electricity consumption is collected and deposited by WAPDA/KESC. The rates prescribed in SRO include the tax collected by WAPDA/ KESC and other taxes paid on inputs.

-Sd-
(Hameed Memon)
Secretary


25th March, 2008 Explanatory Notes for SRO 309(I)/2008
 
  Amends the Sales Tax Special Procedures Rules, 2007, to provide that that in case of electric power supplied by WAPDA, the additional charge of Rs. 0.10 per kwh, collected on account of Neelum Jehlum Hydro Power Development Fund shall not be included in value for determination of sales tax payable.

-Sd-
(Hameed Memon)
Secretary


19th March, 2008

PRESS RELEASE

Secretary General, Revenue Division/Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf has directed the Member (IMS)/CEO PRAL to coordinate with technical wings of the Board to clearly identify problems being faced by the taxpayers in e-filing of returns, Tax Management System and computerised system of payment of taxes and all possible efforts be made in collaboration with NBP to resolve them at the earliest.
 
 He was addressing the members of the Board-in-Council which met here yesterday. FBR Chairman presided over the meeting which lasted for about nine hours.

Referring to the revenue collection for the current financial year, the Chairman observed that despite all odds FBR was still in a position to cross Rs. One trillion mark by 30th June, 2008, provided we all work hard and feel our national obligations.

While reviewing the progress of various on-going reforms projects, the Chairman directed Member (TARP) and the line members to observe time line and expedite completion of refurbishment of the RTOs/MCCs. He also directed the Member (TARP) & Member (IMS) to make necessary arrangements to provide computer hardwares to field formations- LTUs & RTOs – on priority basis.
 
 Current exercise of sectoral examination of sugar/cement also came under discussion. The Chairman desired for early completion of the exercise. Responding Member (Audit) assured that it will be completed in next three weeks. Sectoral study of telecom and other major sectors also came under discussion, line members assured the Chairman of their concerted efforts in this regard and results of such sectoral studies will be presented to the Board.
 
 The Chairman directed the Sales Tax Wing to ask Collectors of Sales Tax to conduct selective taxpayers’ audit wherever they have any doubt. He also directed Member (Audit) to evaluate the audits, conducted by LTU, Lahore, and inform the Council about its results.
 
 Expressing his displeasure over thousands of pending refund claims at Export Collectorate and MCC, Karachi, the Chairman directed Member (Customs) to take action against the officials responsible for this huge pendency that has caused inconvenience to the exporters/importers. The meeting, however, noted that 80% of the refund claims were of very small amount which should be paid immediately.
 
 Board-in-Council also dilated upon the security arrangements currently in place at FBR Headquarters and its field formations, particularly in major cities of the country. The Council asked Member (Admn.) to ensure fool-proof security arrangements at all FBR buildings.
 
 Shortage of staff at FATE/Audit Wings also came under review and the Council decided to ask Member (Admn) to meet their staff requirements.
 
 Purchase of buses for pick and drop of staff from the offices will be examined by Member (TP&R) and the issue will be discussed in the next B.I.C. meeting.
 
 BIC was informed by Member (FATE) that all representations u/s 7 of FBR, Act: 2008 to the Chairman FBR will be received in the FATE Wing and then sent to respective members for their comments. The meeting was informed that a window was being opened in the FBR website where such representations could be submitted on line for redressal of grievances which are simple in nature.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


14th March, 2008 ABDULLAH YUSUF LAUNCHES ONLINE HRM SYSTEM OF FBR

Secretary General, Revenue Division/Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf, today formerly launched online modules of indigenously developed Human Resource Management System of FBR.
All Members of the Board were present on this momentous occasion.
The Human Resource Management System (HRMS) has started providing following online facilities to its field offices and the employees:

  • Online Leave requests receiving from field, its approvals in FBR management and electronic notification on web.

  • Online NOC for trainings/visits abroad, processing and its communication through e-mail

  • Online access to Charge assumption and automatic data updation in the system

  • Updation of employees records and their profiles by field offices including discipline and other issues,

  • Online access to employees to register their grievances against the Board

  • All employees' related notification are placed on FBR website

Speaking on the occasion, Mr. Abdullah Yusuf told that FBR is a leading public sector organization, which has again taken the lead in development and implementation of paperless online processing of employees' applications and other requests. eDoX systems have also been implemented to completely track the mail and files, incoming & outgoing both, in the Board. Member (Administration) is efficiently leading his team towards introduction of such world class systems, which has tremendously increased the performance of the Administration.

The Project Director told that implementation of this system has become possible only through persistent support and encouragement from the Chairman. FBR intends to introduce a complete paperless solution for its Management as well as other functions within shortest possible time. FBR is now in a position that it can provide guidance and support to other Ministries/Divisions to introduce and implement such system for improving their performance and vigilance and also the monitoring functions.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


14th March, 2008

 IMPORT OF CNG BUSES OF INDIAN ORIGIN

CNG buses (15 units) were imported from Sharjah in CBU condition. These buses were assembled/manufactured in UAE from the components/parts imported from India. Therefore, a question arose regarding determination of origin of these buses, since the import of such buses is not allowed from India as per Import Policy Order in vogue.
 

The Ministry of Commerce and the Ministry of Industries, Production and Special Initiatives informed the Federal Board of Revenue to process the cases of import of buses in consultaion with the local stakeholders and after thorough scrutiny as local industry was agitating that the vehicles were of Indian origin.


In order to mitigate the hardship faced by the importers and to safeguard the interest of local manufactures/assemblers, it was proposed by the FBR and the Ministry of Commerce, as a special dispensation, to allow one time import authorization of the already imported 15 buses subject to the condition that the importer undertakes not to import such buses in future.

 

The matter was taken up by the ECC of the Cabinet and the ECC finally approved the release of 15 CNG buses on one time authorization of the Ministry of Commerce on payment of the leviable duty and taxes in addition to the redemption fine equal to 30% of their C &F value.

 

 In order give effect to the ECC’s above referred decision an amending notification SRO---(1)2008 dated dated 12th March, 2008 has been issued

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


13th March, 2008 TV/PICTORIAL COVERAGE
Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf will visit Al-Ghurair Giga (Pakistan) and attend a Briefing/Presentation on World Trade Centre, Islamabad at Defence Housing Society, Phase-II , Islamabad on 14th March, 2008 (Friday) at 3.30 p.m.

All Economic Correspondents, TV channels and Press Photographers are cordially invited to cover/ attend the Briefing.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


13th March, 2008 DUTY REDUCTION ON LCD PANELS, PLASMA DISPLAY PANELS IMPORT
 
M/s Pakistan Electronics Manufacturers Association (PEMA) and manufacturers/assemblers of Plasma Display Panel (PDP) and Liquid Crystal Display Panel (LCD) represented the government that they are facing tough competition because of smuggling of said items. They claimed that smuggled television sets are available at prices 28% to 41% cheaper than locally produced/assembled LCD/PDP. This price difference rendered the local assembling/manufacturing of LCD/PDP uncompetitive in the domestic market. They proposed to abolish customs duty on the SKD of the LCD and Plasma TVs together with application of strict administrative measures.

The Government examined the representations with a view that administrative measures alone cannot address to curb the smuggling and there is a need to revisit the existing tariff regime for this industry. Accordingly, in order to boost up the competitiveness of the domestic manufacturing/assembling of LCD/PDP, the matter was taken up by the Economic Coordination Committee (ECC) of the Cabinet in its meeting held on 22nd January, 2008 and the ECC decided to exempt whole of the duty on CKD kits and reduce the duty on LCD/PDP in SKD kits and CBU from 5% and 20% from exiting 10% and 25%, respectively, for a period of one year and during this period the National Tariff Commission (NTC) will carry out examination of the concessionary tariff for LCD/PDP and will submit its recommendations for continuance or otherwise of the tariff after one year.

In order to give effect to the ECC's said decision two amending Notifications No. SRO 267(1)/2008 dated 10th March, 2008 and SRO 268(1)2008 dated 10th March, 2008 have been issued. Thereby, the CKD kits, SKD kits for LCD and PDP shall be importable at the rate of duty at 0% and 5%, respectively, for the period from 10th March, 2008 to 9th March, 2009 under SRO 565(1)/2006 dated 5-6-2006 and LCD/PDP in CBU from shall be importable at the rate of duty at 20% under SRO 567(1)/2006 dated 5-6-2006 for the said period.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


12th March, 2008 Explanatory notes for SRO 275(I)/2008 dated 12.03.2008
The Notification has been issued to exempt the import and supply of CKD kits of single cylinder agriculture diesel engines of 3 to 36 HP from sales tax. Previously, such CKD kits of 12 to 32 HP were exempt. The scope of exemption has been enhanced from 3 to 36 HP as the local industry has gained success in the manufacturing of agricultural diesel engines of capacity 3 to 36 HP. This step would facilitate the farmers who use agricultural diesel engines for farming activities.

Sd-
(Mehmood Alam)
Additional Secretary


6th March, 2008 Explanatory notes for SRO 204(I)/2008
SRO 204(I)/2008 dated 04.03.2008 amends SRO 1202(I)/2007 dated 11.12.2007. SRO 1202(I)/2008 provides for refund of excess input tax to the Independent Power Producers (IPPs) for the tax period July 2007 to December 2007. Through the amendment, the scope of SRO has been extended to the tax period March 2008. Moreover, the date for filing the claim has been extended from 31stJanaury 2008 to 30th April 2008.

Sd-
(Abdul Hameed Memon)
Secretary


6th March, 2008 CUSTOMS DUTY ON IMPORT OF MAIZE GRAIN EXEMPTED
The Federal Government has exempted 10% customs duty on maize grain imported by poultry sector by issuing SRO 215 dated 05-03-2008 amending SRO 567(I)/2006 dated 05-06-2006. This measure has been taken to mitigate difficulties being faced by the poultry industry in meeting its demand of maize because of short supply and higher price in the domestic market. It will also help reduce the practice of replacing maize with wheat in the poultry feed which will in-turn ease out pressure on the wheat supply in the country.

Sd-
(Ahmad Rauf)
Secretary


4th March, 2008 FBR HAS SURPASSED THE REVENUE TARGET SET FOR FEBRUARY 2008.
 
1.FBR has surpassed the revenue target of Rs. 68.2 billion assigned for February 2008.

2. The provisional tax collection for February 2008 has achieved an overall growth of 30.4%. The net collection during February 2008 has been Rs. 68.3 billion against Rs. 52.4 billion during February 2007. The revenue on account of direct taxes has risen sharply from Rs. 13.8 billion last February to Rs. 22.1 billion in February 2008 reflecting a growth of 60.2%. The sales tax collection has been Rs. 27.2 billion as against Rs. 23.7 billion of last February showing a growth of 14.7%. While sales tax on import stage has decreased by 0.6% due to zero-rating of crude oil, the increase in the domestic component is 35.4%. The collection of federal excise duties has increased by 40.8%, increasing from Rs. 5.6 billion to Rs. 7.9 billion. Finally, a healthy growth of 19.9% has also been recorded in the collection of customs duties where the net receipts have reached Rs. 11.2 billion against Rs. 9.3 billion of last February.

3. The July – February collection of FBR now stands at Rs. 579.7 billion as against Rs. 515.1 billion of corresponding period of last year showing a growth of 12.5%.

4. The provisional figures of February are expected to increase further during the next few days
 

Sd-
(Khawar Khurshid Butt))
Member (FATE)


3rd March, 2008 Explanatory notes for SRO 193(I)/2008 dated 03.02.2008
The Notification has been issued to exempt the import and supply of agricultural tractor below 35 HP from sales tax. It is the policy of the Government of Pakistan to exempt all agricultural tractors from sales tax. However, tractors below 35 HP classifiable under HS code 8701.9090 were not included in the Sixth Schedule of Sales Tax Act, 1990 inadvertently. This notification has been issued to rectify the legal position that the agricultural tractors below 35 HP imported into Pakistan and their supply is also exempt from sales tax.

Sd-
(Usman Khalid Mirza)
Additional Secretary


3rd March, 2008 Explanatory notes for SRO 192(I)/2008 dated 03.02.2008
The Notification has been issued on the decision of ECC that value added products of poultry meat and fish may be zero-rated to provide benefit to the consumers.

Sd-
(Usman Khalid Mirza)
Additional Secretary


25th February, 2008 Explanatory notes for SRO 170(I)/2008 dated 22.02.2008
This Notification has been issued to facilitate the importers of re-rollable scrap of inferior quality importing through the land routes of Iran and Afghanistan. Previously, the import value of this item was fixed at US$ 400 per tonne vide SRO 678(I)/2007 dated 6.7.2007. This value was much higher for assessment of inferior scrap imported through the land routes from Iran and Afghanistan. Therefore, the instant notification has been issued whereby the value of this item imported from land routes of Iran and Afghanistan has been fixed at US$ 275 per tonne.

Sd-
(Asif Abbas)
Second Secretary


14th March, 2008 ABDULLAH YUSUF LAUNCHES ONLINE HRM SYSTEM OF FBR

Secretary General, Revenue Division/Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf, today formerly launched online modules of indigenously developed Human Resource Management System of FBR.
All Members of the Board were present on this momentous occasion.
The Human Resource Management System (HRMS) has started providing following online facilities to its field offices and the employees:

  • Online Leave requests receiving from field, its approvals in FBR management and electronic notification on web.

  • Online NOC for trainings/visits abroad, processing and its communication through e-mail

  • Online access to Charge assumption and automatic data updation in the system

  • Updation of employees records and their profiles by field offices including discipline and other issues,

  • Online access to employees to register their grievances against the Board

  • All employees' related notification are placed on FBR website


Speaking on the occasion, Mr. Abdullah Yusuf told that FBR is a leading public sector organisation, which has again taken the lead in development and implementation of paperless online processing of employees' applications and other requests. eDoX systems have also been implemented to completely track the mail and files, incoming & outgoing both, in the Board. Member (Administration) is efficiently leading his tem towards introduction of such world class systems, which has tremendously increased the performance of the Administration.

The Project Director told that implementation of this system has become possible only through persistent support and encouragement from the Chairman. FBR intends to introduce a complete paperless solution for its Management as well as other functions within shortest possible time. FBR is now in a position that it can provide guidance and support to other Ministries/Divisions to introduce and implement such system for improving their performance and vigilance and also the monitoring functions.
 

-Sd-

Muhammad Hafeez Mughal)
Secretary (PR)


14th March, 2008

 IMPORT OF CNG BUSES OF INDIAN ORIGIN

CNG buses (15 units) were imported from Sharjah in CBU condition. These buses were assembled/manufactured in UAE from the components/parts imported from India. Therefore, a question arose regarding determination of origin of these buses, since the import of such buses is not allowed from India as per Import Policy Order in vogue.
 

The Ministry of Commerce and the Ministry of Industries, Production and Special Initiatives informed the Federal Board of Revenue to process the cases of import of buses in consultaion with the local stakeholders and after thorough scrutiny as local industry was agitating that the vehicles were of Indian origin.


In order to mitigate the hardship faced by the importers and to safeguard the interest of local manufactures/assemblers, it was proposed by the FBR and the Ministry of Commerce, as a special dispensation, to allow one time import authorization of the already imported 15 buses subject to the condition that the importer undertakes not to import such buses in future.

 

The matter was taken up by the ECC of the Cabinet and the ECC finally approved the release of 15 CNG buses on one time authorization of the Ministry of Commerce on payment of the leviable duty and taxes in addition to the redemption fine equal to 30% of their C &F value.

 

 In order give effect to the ECC’s above referred decision an amending notification SRO---(1)2008 dated dated 12th March, 2008 has been issued

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


13th March, 2008 TV/PICTORIAL COVERAGE
Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf will visit Al-Ghurair Giga (Pakistan) and attend a Briefing/Presentation on World Trade Centre, Islamabad at Defence Housing Society, Phase-II , Islamabad on 14th March, 2008 (Friday) at 3.30 p.m.

All Economic Correspondents, TV channels and Press Photographers are cordially invited to cover/ attend the Briefing.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


13th March, 2008 DUTY REDUCTION ON LCD PANELS, PLASMA DISPLAY PANELS IMPORT
 
M/s Pakistan Electronics Manufacturers Association (PEMA) and manufacturers/assemblers of Plasma Display Panel (PDP) and Liquid Crystal Display Panel (LCD) represented the government that they are facing tough competition because of smuggling of said items. They claimed that smuggled television sets are available at prices 28% to 41% cheaper than locally produced/assembled LCD/PDP. This price difference rendered the local assembling/manufacturing of LCD/PDP uncompetitive in the domestic market. They proposed to abolish customs duty on the SKD of the LCD and Plasma TVs together with application of strict administrative measures.

The Government examined the representations with a view that administrative measures alone cannot address to curb the smuggling and there is a need to revisit the existing tariff regime for this industry. Accordingly, in order to boost up the competitiveness of the domestic manufacturing/assembling of LCD/PDP, the matter was taken up by the Economic Coordination Committee (ECC) of the Cabinet in its meeting held on 22nd January, 2008 and the ECC decided to exempt whole of the duty on CKD kits and reduce the duty on LCD/PDP in SKD kits and CBU from 5% and 20% from exiting 10% and 25%, respectively, for a period of one year and during this period the National Tariff Commission (NTC) will carry out examination of the concessionary tariff for LCD/PDP and will submit its recommendations for continuance or otherwise of the tariff after one year.

In order to give effect to the ECC's said decision two amending Notifications No. SRO 267(1)/2008 dated 10th March, 2008 and SRO 268(1)2008 dated 10th March, 2008 have been issued. Thereby, the CKD kits, SKD kits for LCD and PDP shall be importable at the rate of duty at 0% and 5%, respectively, for the period from 10th March, 2008 to 9th March, 2009 under SRO 565(1)/2006 dated 5-6-2006 and LCD/PDP in CBU from shall be importable at the rate of duty at 20% under SRO 567(1)/2006 dated 5-6-2006 for the said period.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


12th March, 2008 Explanatory notes for SRO 275(I)/2008 dated 12.03.2008
The Notification has been issued to exempt the import and supply of CKD kits of single cylinder agriculture diesel engines of 3 to 36 HP from sales tax. Previously, such CKD kits of 12 to 32 HP were exempt. The scope of exemption has been enhanced from 3 to 36 HP as the local industry has gained success in the manufacturing of agricultural diesel engines of capacity 3 to 36 HP. This step would facilitate the farmers who use agricultural diesel engines for farming activities.

Sd-
(Mehmood Alam)
Additional Secretary


6th March, 2008 Explanatory notes for SRO 204(I)/2008
SRO 204(I)/2008 dated 04.03.2008 amends SRO 1202(I)/2007 dated 11.12.2007. SRO 1202(I)/2008 provides for refund of excess input tax to the Independent Power Producers (IPPs) for the tax period July 2007 to December 2007. Through the amendment, the scope of SRO has been extended to the tax period March 2008. Moreover, the date for filing the claim has been extended from 31stJanaury 2008 to 30th April 2008.

Sd-
(Abdul Hameed Memon)
Secretary


6th March, 2008 CUSTOMS DUTY ON IMPORT OF MAIZE GRAIN EXEMPTED
The Federal Government has exempted 10% customs duty on maize grain imported by poultry sector by issuing SRO 215 dated 05-03-2008 amending SRO 567(I)/2006 dated 05-06-2006. This measure has been taken to mitigate difficulties being faced by the poultry industry in meeting its demand of maize because of short supply and higher price in the domestic market. It will also help reduce the practice of replacing maize with wheat in the poultry feed which will in-turn ease out pressure on the wheat supply in the country.

Sd-
(Ahmad Rauf)
Secretary


4th March, 2008 FBR HAS SURPASSED THE REVENUE TARGET SET FOR FEBRUARY 2008.
 
1.FBR has surpassed the revenue target of Rs. 68.2 billion assigned for February 2008.

2. The provisional tax collection for February 2008 has achieved an overall growth of 30.4%. The net collection during February 2008 has been Rs. 68.3 billion against Rs. 52.4 billion during February 2007. The revenue on account of direct taxes has risen sharply from Rs. 13.8 billion last February to Rs. 22.1 billion in February 2008 reflecting a growth of 60.2%. The sales tax collection has been Rs. 27.2 billion as against Rs. 23.7 billion of last February showing a growth of 14.7%. While sales tax on import stage has decreased by 0.6% due to zero-rating of crude oil, the increase in the domestic component is 35.4%. The collection of federal excise duties has increased by 40.8%, increasing from Rs. 5.6 billion to Rs. 7.9 billion. Finally, a healthy growth of 19.9% has also been recorded in the collection of customs duties where the net receipts have reached Rs. 11.2 billion against Rs. 9.3 billion of last February.

3. The July – February collection of FBR now stands at Rs. 579.7 billion as against Rs. 515.1 billion of corresponding period of last year showing a growth of 12.5%.

4. The provisional figures of February are expected to increase further during the next few days
 

Sd-
(Khawar Khurshid Butt))
Member (FATE)


3rd March, 2008 Explanatory notes for SRO 193(I)/2008 dated 03.02.2008
The Notification has been issued to exempt the import and supply of agricultural tractor below 35 HP from sales tax. It is the policy of the Government of Pakistan to exempt all agricultural tractors from sales tax. However, tractors below 35 HP classifiable under HS code 8701.9090 were not included in the Sixth Schedule of Sales Tax Act, 1990 inadvertently. This notification has been issued to rectify the legal position that the agricultural tractors below 35 HP imported into Pakistan and their supply is also exempt from sales tax.

Sd-
(Usman Khalid Mirza)
Additional Secretary


3rd March, 2008 Explanatory notes for SRO 192(I)/2008 dated 03.02.2008
The Notification has been issued on the decision of ECC that value added products of poultry meat and fish may be zero-rated to provide benefit to the consumers.

Sd-
(Usman Khalid Mirza)
Additional Secretary


25th February, 2008 Explanatory notes for SRO 170(I)/2008 dated 22.02.2008
This Notification has been issued to facilitate the importers of re-rollable scrap of inferior quality importing through the land routes of Iran and Afghanistan. Previously, the import value of this item was fixed at US$ 400 per tonne vide SRO 678(I)/2007 dated 6.7.2007. This value was much higher for assessment of inferior scrap imported through the land routes from Iran and Afghanistan. Therefore, the instant notification has been issued whereby the value of this item imported from land routes of Iran and Afghanistan has been fixed at US$ 275 per tonne.

Sd-
(Asif Abbas)
Second Secretary


22nd February, 2008 Explanatory notes for SRO 155(I)/2008 dated 21.02.2008
This notification amends S.R.O. 390(I)/2001, dated the 18th June, 2001, which relates to collection of activation charges on mobile phones. Before the amendment, the cellular phone companies were required to file return in relation to activation charges by the 15th of the next month. Now, after the amendment, they shall file return by the 21st of next month along with their return in respect of telecommunication services provided. Through this amendment, the requirement to file separate returns for two types of payments has been done away with and cellular companies can now combine the return for activation charges with the return for their telecommunication services.

Sd-
(Abdul Hameed Memon)
Secretary


22nd February, 2008 Explanatory notes for SRO 154(I)/2008 dated 21.02.2008
The notification amends SRO 645(I)/2007 dated 27.06.2007 and excludes finished pesticides from purview of 2% additional tax payable by commercial importers under SRO 645(I)/2007. The notification is continuation of SRO 91(I)/2008 dated 30.01.2008 which excluded active ingredients of pesticides from purview of SRO 645(I)/2007 and now through this notification the pesticides falling in PCT 38.08 have also been so excluded. It may be noted that finished pesticides and active ingredients are already subject to 2.25% additional tax under SRO 645(I)/2006 dated 21.06.2006.

Sd-
(Abdul Hameed Memon)
Secretary


13th February, 2008 Explanatory notes for SRO 135(I)/2008 dated 12.02.2008

The exemption to sales tax on margarine has been provided through this notification. The PCT heading of margarine was omitted inadvertently from the Sixth Schedule (list of exemptions) of the Sales Tax Act, 1990, through the Finance Act 2007. The notification aims at correcting this anomaly. It may be added that margarine is also subjected to FED at 15% in GST mode, therefore, the levy of further 15% sales tax was not justified.

 Note: The notifications aims at removing an anomalous situation, therefore, the same may not be publicised.

-Sd-
(Abdul Hameed Memon)
Secretary

 
9th February, 2008 TAX REFORMS TO CREATE WIN-WIN SITUATION FOR ALL STAKEHOLDERS: ABDULLAH YUSUF


Secretary General, Revenue division and Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf has said that the on-going tax administration and policy reforms would play a vital role in enhancing the country's financial resources, resolving the problems of the business community and facilitating the taxpayers.

Addressing the officers/officials of the Customs & Federal Excise Department, based in Islamabad/Rawalpindi at "Employees Workshop", the Chairman confidently said that the reforms, on their completion in December, 2009, would create a win-win situation for all the three major stake-holders viz: the Government, the taxpayers and the employees of the Board. He said that we were in transition phase and still have to go a long way to achieve the desired results.

Referring to the various initiatives, taken in Customs Department, including setting up of CARE/PaCCS system and Model Custom Collectorates, the Chairman remarked that these measures have not only facilitated the importers & exporters in clearance of their goods to a great extent but also considerably reduced their cost of doing business and save their precious time. He was pretty sure that the FBR's reforms would also be helpful in attracting local and foreign investment as, he observed, "No county can make progress without investment." He said, the reforms initiatives in customs and sales tax & federal excise were also facilitating trade.

Mr. Abdullah Yusuf was of the opinion that FBR has to play its due role as a key institution of the Government to meet financial needs of the Government and help implement its fiscal policies. He said, sufficient financial resources were essential to enhancing Gross Domestic Product and subsequently the Per Capita Income. He informed that the Per Capita Income which was $ 425 few years back was now $ 850 and termed it as a "positive sign". 'We have to play our role to further increase the GDP and Per Capita Income to make life easier for our countrymen', he added.

Chairman observed that the positive change brought about by the tax reforms have already been noticed and acknowledged by the public and private

sectors particularly the taxpayers. He said, over 100,000 tax appeals and adjudication cases which were pending for the last several years were disposed of through a well-formulated policy.

Listing various steps taken by the Board for the welfare of the employees, the Chairman told the officials that the establishment of FBR Foundation would take care of all of their educational, health and housing needs. He said, a sufficient amount would be allocated to help out the employees in hours of distress and to get them cured from terminal diseases.

Replying to various questions, put forward by the employees, the Chairman assured that no employees would be expelled from service forcibly for not clearing IJP test and training and re-training will be arranged to enhance their capacity and to absorb them in the system. However, a package would be formulated for employees who would like to leave the Department voluntarily. He further said that the Inspectors would be up-graded to BS-14 besides implementation of the Government's recent decision to upgrade the clerical staff.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


7th February, 2008
 
MEDIA COVERAGE

Regional Tax Office, Rawalpindi is arranging an Employees Workshop at Royal Palace Hotel (opposite Ayub National Park), in Rawalpindi, on 8th February, 2008(Friday) at 10.00 a.m.
Secretary General, Revenue Division/Chairman, Federal Board of Revenue will be the Chief Guest.
All Economic Correspondents, TV channels and Press Photographers are cordially invited to cover the Workshop.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


4th February, 2008 TOTAL INVOLEMENT & COMMITTEMT OF FBR EMPLOYEES REQIRED FOR TARP'S SUCEESS: ABDULLAH YUSUF
 

Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf has said that the total involvement and commitment of FBR employees were required to execute the on-going Tax Administration Reforms Programme (TARP) and Tax Policy Programme with a complete success.

He was addressing at the first-ever "Employees Workshop" arranged by the Board here today. All officers/officials of FBR Headquarters attended the Workshop. Similar employees workshops are also planned at Lahore, Karachi and Rawalpindi.

Chairman said that all officers/officials have to make determined efforts to make FBR an institution of international standard that could facilitate the taxpayers and deliver to the needs of the Government. Besides facilitation and education of taxpayers, the major focus of the programme was on training & re-training of the employees, end-to-end solution of the problems through automation and infrastructural development. A considerable progress has already been made in this regard, Mr. Yusuf said and added, we have to make the things easy for the taxpayers and improve the efficiency, capability and working environment of our employees to enable them to give better results. He said that the infrastructural facilities and working environment provided at Regional Tax Offices (RTOs) were comparable to any of the tax institution in the developed countries. To incentives the FBR employees, Government has increased their wages. Now, the concept of living wages exists in FBR. But, the Chairman said, we now have to prove and justify this special treatment through our efficiency, performance and results.
Chairman informed that out of 25,000 employees of FBR and its field offices, 16,500 have already been granted special pay position (double salary). The Chairman also underlined various on-going projects of infrastructural development which include building of an additional block of FBR with a total cost of Rs. 230 million.
The Chairman apprised that FBR is in the process of acquiring a piece of land measures 200/300 areas for employees residential accommodation to alleviate their housing problems.
On establishment of FBR Foundation, Mr. Abdullah Yusuf said that the primary objective of this Foundation was the welfare of employees and to look-after their housing, educational and health needs. He said, the Foundation will be fully operative by the end of the current calendar year. He termed the setting up of Foundation as a major achievement. He also mentioned various other steps taken by the Board for the welfare of its employees and streamling their office duties.
Speaking on the prevailing security environment, the Secretary General told that the security of the employees and the office buildings was being ensured through a system. For disposal of disciplinary cases, a Committee has been constituted which has been assigned the task to settle all the cases as early as possible.
Talking about the transformation of CBR into FBR, the Chairman said that it was not simply change of the nomenclature but much more than that. "It now gives us much greater autonomy which would help us to grow at a faster pace and become an institution capable to deliver as a prime revenue generating agency of the country", he added. He said, the autonomy which FBR enjoys today was never available before in the history of the Board.
Regarding his decision to set up Complaint/Suggestion Cell, the Chairman said the objective of its establishment was to personally have knowledge of the problems of the employees. Any aggrieved staff member of FBR may avail this facility, the Chairman said. He assured the employees that all of their genuine problems will be addressed.
Later, an open question-answer session was held in which the employees of FBR apprised the Chairman of their service/promotional issues, distribution of official work and the training needs.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


31st January, 2008 FBR CHAIRMAN ASKS COLLECTORS TO RELY ON AUTOMATED SYSTEMS & PROCEDURES
29.1% GROWTH ACHIEVED IN CUSOTMS DUTY COLLECTION IN JANUARY

 
Quarterly Conference of Collectors of Custom was held here today under the chairmanship of the Secretary General, Revenue Division/Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf.

Speaking on the occasion, the Chairman stressed upon the collectors to make concerted efforts to enable the FBR to deliver to the economic and material development needs of the country. He said, the Customs officials can strengthen themselves by strengthening and updating the systems and procedures. We must rely on automated systems & procedures instead of manual ones to achieve the desired results, he added.

Underlining the need of bringing improvement in revenue collection, the Chairman directed the collectors to effectively check under-invoicing/ valuation and mis-declaration of goods, to plugging possible avenues of revenue leakages, quick recovery of out-standing arrears and constant monitoring of exemptions regime. He also asked the collectors to send monthly report on recovery of arrears.

Earlier, the Secretary (Customs Budget), Mr. Muhammad Saleem, highlighting the over-all performance of the customs collectorates, informed the Conference that the total customs duty collection for the month of January, 2008 stood at Rs. 12.4 billion as against Rs. 9.6 billion collected in January, 2007, thus registering a growth of 29.1%. Target of customs duty collection for January, 2008 was Rs. 10.1 billion. Duty collection in first six months (July-December) of current financial year was Rs. 61.6 billion as compared to Rs. 60.7 billion collected in the same period of 2006-07.

Major revenue spinners were edible oil, electrical machinery, plastic & articles, paper and paper board, articles of irons & steel, soap & detergents etc.

Regarding improvisation of One-customs system, M/S Pakistan Revenue Automation Limited (PRAL) has been asked to improvise the One-customs software which may include, among other solutions, assigning of separate destination codes for NLC Dry Port Amangarh, Railways Dry Ports at Peshawar Cantt. & city, Torkhum & Chaman etc. with an inbuilt validation and verification system.

Conference was informed that M/S PRAL’s existing Transshipment Permit (TP) Monitoring Module was being improvised. It was further decided to establish dedicated TP/AP section at Appraisement, Prot Qasim collectorates in Karachi and at Chaman collectorate (Quetta) for daily manifest clearance of each border carrier. Similar arrangement was proposed for Lahore & Quetta collectorates.

It was further told that the Preventive Collectorate, Karachi was developing a procedure in consultation with PIA authorities, for TPs moved through PIA. Once

notified, the system will be replicated at other Freight Units. In addition to this, Appraisement and Port Qasim collectorates were developing procedure for acknowledgment of TPs filed by clearing agents for ships spare-parts. The Conference was assured that both of these systems would be put in place in next 15 days.

About inter-port movement of cargo to and form off-dock terminals viz: NLC, AICT, Pak Shaheen, BOML and QFS to the Port of Karachi and Port Qasim, conference was apprised that terminal operators were being actively pursued to ensure the movement of their cargo through bonded carriers. To facilitate the trade, short period extensions were being granted by the Collectors/Chief Collector (South) to avoid clogging of cargo at port and terminals.

Mr. Abdullah Yusuf, however, advised the collectors that at any point of time the relevant collector must know that what (goods) was in the transit concerning his collectorate. He said, the system was supposed to put time-line for a consignment and if a consignment was not reached at any particular destination within the time-limit, there should be a flash on the system indicating its non-arrival.
 

 

  -Sd-

(Muhammad Hafeez Mughal)

                                                                                                Secretary (PR)


31st January, 2008 Explanatory notes for SRO.90(I)/2008
The notification 90(I)/2008 dated 29.01.2008 has been issued amending Notification 943(I)/07, dated 14.09.2007 regarding export of goods to Afghanistan. It is requested that the same may please be placed on Web site

Sd-
(Khalid Mahmood)
Second Secretary


31st January, 2008 Explanatory notes for SRO 91(I)/2008

The commercial importers of pesticides were paying extra 2% sales tax at import stage under SRO 645(I)/2007 dated 27.06.2007 along with all other commercial importers. But they also had to pay further 2.25% sales tax under SRO 645(I)/2006 dated 21.06.2006 which requires payment of this additional tax by all importers, including manufacturers and commercial importers, of pesticides and their active ingredients and exempts the same levy of sales tax on further supplies. SRO 91(I)/2008 removes this anomaly and excludes commercial importers from payment of 2% of sales tax under notification SRO 645(I)/2007. Now, they will only pay 2.25% additional sales tax under SRO 645(I)/2006 along with regular 15% sales tax.

Sd-
(Abdul Hameed Memon)
Secretary


26th January, 2008 FBR CHAIRMAN STRESSES ON TAPPING FULL REVENUE POTENTIAL TO RECOVER REVENUE LOSSES
16th National Tax Conference was held here today under the chairmanship of the Secretary General, Revenue Division & Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf.

Speaking on the occasion, the Chairman advised the tax managers to tap full revenue potential existing in various sectors to recover the revenue losses occurred due to the disturbances in the country last month and gas and electricity shortages which have slowed down the business, trade and industrial activities in the country.

The Chairman also identified various grey areas from which the full revenue potential is yet to be tapped. He stressed that the tax mangers have to pay special attention to enhance revenue collection from these areas. In this connection, he particularly referred the nominal revenue collection on rental income from the properties. Mr. M. Abdullah Yusuf expressed the need to formulate an action plan to tap the tax potential by utilizing the computerised data available with different institutions/departments within the provinces. He further reiterated that we have to tackle all such issues in a professional manner.

Chairman also underlined the need of plugging the revenue leakages to improve the tax collections.

During the conference, a comprehensive discussion was held on with-holding taxes and a number of avenues were marked to un-earth the non-deduction by effective monitoring and matching the information being received form different quarters. Discussion on preparing and rechecking of the list of with-holding agents was also discussed at length.

Earlier, Member (Direct Taxes) Mr. Usman Khalid Mirza, in his presentation, briefed the conference about the overall performance of the Wing and its field formations. He said, the disturbances and electcity load-shedding have seriously

affected the e-filing of corporate returns in December-which was a very crucial month for direct taxes collection this has forced FBR to extend its date upto January 31, 2008. He, however, said that a considerable growth have already witnessed in e-filing of returns of corporate and Association of Persons (AOPs).

Regarding recovery of arrears, Mr. Usman Mirza informed the participants that Rs. 4.7 billion have already been recovered upto 31st December, 2007, leaving the pending balance of Rs. 22.4 billion. During July-December, 2007, refund claims amounting to Rs. 13 billion have been cleared. He expressed the hope that Budget fixed for the current year will be hopefully achieved.

Member (Legal), Mr. Mumtaz Ahmed Sheikh briefed the conference about the progress made in liquidation of litigation at various levels. He informed that a total number of 3592 tax appeals were disposed off by the Supreme Court of Pakistan since January, 2006 which included 2533 of direct taxes and 1059 of indirect taxes.

Chief (Audit) Mr. Humayun Khan Sikandari appraised the conference that the National Audit Plan has been formulated and subsequently adopted by the FBR. He assured the participants that 100% settlement of all internal audit paras will be achieved by 30th June, 2008. FBR Chairman, Mr. M. Abdullah Yusuf appreciated the performance of Audit Wing.
 

Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


25th January, 2008 Explanatory notes for SRO 76(I)/2008 dated 23.01.2008

The Notification has been issued on the recommendation of Ministry of Production as special initiatives for encouraging the marble industry in Pakistan. The issuance of this notification would exempt the small manufacturers of marble industry from requirement of getting sales tax registration whose annual turnover is less than five million even though its annual electricity bills is less than six hundred thousand rupees.

-Sd-
(Mehmood Alam)
Additional Secretary


23rd January, 2008
PAKISTAN, JAPAN SIGN REVISED CONVENSION FOR AVOIDANCE OF DOUBLE TAXATION

The Federal Board of Revenue initiated negotiations for the revision for the existing Convention for the Avoidance of Double Taxation between Islamic Republic of Pakistan and the Government of Japan. Tax delegations of both the countries met at Tokyo and finally at Islamabad. After detailed deliberations, a consensus was achieved and revised draft Convention was initialed by the respective heads of delegation on 17th May, 2007 at Islamabad. The Convention was signed by Mr. M. Abdullah Yusuf, Secretary General, Revenue Division, on behalf of the Government of Pakistan and Mr. Seiji Kojima, Japanese Ambassador at Islamabad, signed on behalf of the Government of Japan.

The signing ceremony was held at the Conference Room of International Taxes in the FBR (Hqs) and was attended, among others, by Member (Direct Taxes), FBR, Mr. Usman Khalid Mirza and senior officials of the Japanese Embassy.

The main features of the revised Convention are as under:

i) Permanent Establishment in the case of building site has been agreed at 6 months.

ii) Delivery from a warehouse will be considered as PE.

iii) Dividend in case of holding companies having 50% voting share for 6 months will be taxed @ 5% holding companies with 25% voting share at 7.5% and all other cases will be taxed @ 10% in the source country.

iv) Tax exemption for government owned banks and financial institutions has also been provided.

v) Royalty at source country will be taxes 10%.

vi) Fee for Technical Services is taxable @ 10% in the source country.

vii) Student's and Business Apprentices' exemptions on their remuneration has been increased from 360,000 Japanese yen to 1,500,000 Japanese yen.

On the occasion of signing the Convention, Secretary General, Revenue Division, Mr. M. Abdullah Yusuf remarked that the Convention will not only provide safeguards against double taxation on the income of the residents of both the countries but also promote economic cooperation, bilateral trade, investment and would further strengthen the existing bilateral economic relations between the two Contracting States. It will provide adequate certainty in respect of taxations rules applicable to cross-border business transactions, dividends, interests, royalties and fee for technical services etc. Taxpayers of both the countries will get relief form double taxation resulting in boosting up the trading activities in both the countries, he added.

In his comments on the occasion, the Japanese Ambassador, Mr. Seiji Kojima, said that he shares the views of the Secretary General on this historic moment and expressed the confidence that the existing very cordial relations between Japan & Pakistan would reflect in all fields particularly in economic, trade and investment sectors. He said, the manufacturing sector of Pakistan is of paramount importance and hoped that more Japanese investment will come in this sector.

The signed Convention will be put up to the Cabinet for ratification to initiate the process of enforcement.

  

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


23rd January, 2008 Explanatory Notes for SRO 77(I)/2008 dated 23.01.2008

The notification amends the Sales Tax Special Procedure (Withholding) Rules, 2007, with the following effects:

(i) Now the amount deducted by the Government departments shall be transferred to sales tax head through book adjustment. Previous procedure of issuance of cheques by AGPR has been done away with. However, the provincial AGs and District Accounts Officer shall transfer the deducted amount by issuing a single cheque for all deductions made during the month. 

(ii) Withholding agent, if registered for sales tax or income tax, shall file return for withholding electronically.

(iii) The exclusions from deduction at source have been extended to cover the following supplies made by a registered person:

(i)         Electrical energy;

(ii)        Natural gas;

(iii)       Petroleum products as supplied by petroleum production and exploration companies, oil refineries and oil marketing companies;

(iv)       mild steel products;

(v)        products made from sheets of iron or non-steel alloy, stainless steel or other alloy steel, such as pipes, almirahs, trunks etc.

(vi)       paper, in rolls or sheets;

(vii)      plastic products including pipes;

(viii)     vegetable ghee and cooking oil; and

(ix)       telecommunication services.”.

-Sd-
(Hameed Memon)
Secretary


22nd January, 2008 CHARGING OF WITHHOLDING TAX ON 2% VALUE ADDITION SALES TAX FROM COMMERCIAL IMPORTERS


Attention of the Federal Board of Revenue has been drawn towards the issue of withholding tax on 2% additional Sales Tax charged to commercial importers at import stage. The situation has been clarified by Sales Tax Wing vide its General Order No. 3 of 2007, that 2% additional tax charged to commercial importer at import stage, is in lieu of value addition at local supply stage, hence it should not be included in the value for determining of withholding tax under section 148.
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


21st January, 2008 FBR QUARTERLY CONFERENCES TO START FROM 26TH JANUARY

Quarterly Conferences of field officers of Federal Board of Revenue will start from 26th January, 2008 (Saturday) in Islamabad.
Secretary General, Revenue Division and Chairman, Federal Board of Revenue, Mr. M. Abdullah Yusuf will preside over all the three quarterly conferences.
During the conferences, performance of the collectorates/commissionerates in the second quarter (October-December) of current financial year will be reviewed and strategy will be evolved to achieve the revenue targets set for the third quarter (January-March).
Follow-up actions taken on the decisions made in the conferences held in October last will also be reviewed.
Conference of Directors General, Commissioners of Income Tax and Commissioners (Appeals) will be held on 26th January (Saturday), Conference of Collectors of Customs & Collectors (Appeals) on 28th January (Monday) and quarterly conference of Collectors of Sales Tax & Collectors (Appeals) on 29th January, 2008(Tuesday).
 

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


16th January, 2008 FBR ISSUES THREE NOTIFICATIONS CONCERNING SALES TAX

Federal Board of Revenue has issued three notifications of Sales Tax--SROs 47(I), 48& 49(I)/2008 dated 15-1-2008. The SROs are briefly explained below:-

SRO 47(I)/2008:

Applies the provisions of sub-section (8) section 194A of the Customs Act, 1969, to the sales tax appeals pending before Appellate Tribunal. The effect would be that all such appeals, even if filed by officers of rank below Additional Collector, would be considered to have been filed by Additional Collector. Thus, such appeals cannot be challenged on the ground that these were not filed by Additional Collector.

SRO 48(I)/2008:

Assigns powers under the Sales Tax Act, 1990, to the officers of the Directorate General of Intelligence and Investigation. Supersedes previous notification SRO 471(I)/2007 dated 09.06.2007.

SRO 49(I)/2008:

Amends the Sales Tax Rules, 2006. The effect of the amendment would be that the scope of mandatory electronic filing has been extended to all sales tax returns and statements due under section 26 and 27 of the Sales Tax Act, 1990. Previously such mandatory e-filing was restricted to monthly sales tax return. Now, statements and special returns such as summary of invoices and special return of production data shall also be filed electronically. However, the mandatory e-filing continues to be restricted to private and public limited companies and those registered in any of the Large Taxpayers Units.



All of the above mentioned SROs have been placed on FBR's website: www.fbr.gov.pk
 

 -Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)
 

15th January, 2008 FBR SEEKS INCOME TAX PROPOSALS FOR BUDGET 2008-09
 

 Federal Board of Revenue has decided to initiate budget exercise for the next financial year i.e. 2008-09 and sought proposals from chambers, tax bars and business organisations for bringing improvement in the existing income tax laws, procedures and administration.

The primary purpose of this exercise is to improve and streamline the income tax laws, procedures and administration, said FBR, in a letter, addressed to the various organisations.

Considering commerce and industry as two vital sectors of the economy, FBR has requested the Federation of Pakistan Chambers of Commerce & Industry (FPCC&I), all Chambers of Commerce and Industry and American Business Council to formulate their budget proposals regarding income tax and forward them to the Board by 10th February, 2008, for due consideration.

In another letter, addressed to the Institute of Chartered Accountants of Pakistan (ICAP) and all Tax Bar Associations, FBR has requested them to forward their proposals aimed at improving Income Tax Ordinance, 2001, procedures and administration. The letter said that the professionals/tax advisors hold a vital position in our tax system and, therefore, FBR welcomes and values their suggestions.

FBR has further requested them that the suggestions they may have with regard to mobilisation of more revenues and for improvement of the income tax laws, procedures and administration may be sent to the Board by February 10, 2008, for necessary consideration.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


15th January, 2008 FILING OF CORPORATE INCOME TAX RETURNS-DATE EXTENDED UP TO 31st JANUARY 2008.

In view of the various representations received from Trade bodies seeking extension in time for  e–filing of Corporate Income Tax Returns, for tax year 2007, on account of difficulties faced in e-filing due to prevalent circumstances (including electricity load shedding etc), for the facilitation of taxpayers, Federal Board of Revenue has decided to extend the date for e – filing of Corporate Income Tax returns up to 31st January, 2008.

-Sd-
(Aftab Ahmad)
secretary(Assessment)


8th January, 2008
 
FBR EMPLOYEES ADVISED TO GET REGISTERED WITH ELECTRONIC SECURITY SYSTEM

In view of the prevailing situation in the country, Federal Board of Revenue, being an organisation currently under-going through reforms, has decided to further improve the security of the Board and ensure safety of its employees. For this purpose, all employees of FBR Headquarters have been advised to get them registered with the electronic security system of the Board before 14th January, 2008 (Monday) to be able to enter the FBR Building.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


8th January 2008 FBR TO SETUP COMPLAINT CELL FOR REDRESSAL OF TAXPAYERS' PROBLEMS

 
Board-in-Council, in its meeting chaired by Secretary General, Revenue Division and Chairman, Federal Board of Revenue Mr. M. Abdullah Yousaf has decided to setup a Complaint Cell under Section 7 of the FBR Act 2007 for redressal of the tax-related grievances of the general public, particularly the taxpayers. This Cell will be a part of Facilitation & Taxpayer Education Wing of FBR and function under the direct supervision of its Member, Mr. Khawar Khurshid Butt.

2. Under Section 7 of the Act, any person aggrieved by the action done or taken for the enforcement of the fiscal laws or due to any act of administration, corruption and misbehavior by any officer or employee of the Board or any unnecessary delay or hardship caused due to any administrative process may prefer representation to the Chairman for redressal of his grievance.

3. While taking this decision, the Chairman directed that the Complaint Cell will take all possible steps for redressal of the problems of any aggrieved person. This facilitation measure will be in addition to other fora available to the aggrieved people for tax related problems/grievances. It was decided that FATE Wing will be strengthened to be able to receive such representations and process according to the provisions of Section 7 of the FBR Act 2007.

4. Board-in-Council reviewed implementation of its earlier decision. Chairman FBR emphasized the need to make detailed analysis in respect of major sectors so that monthly reports are generated by Customs, Income Tax and Sales Tax Wings for better monitoring of revenue collection. He urged the technical Members to ensure that regular analysis is institutionalized that will enable the Board to keep effective check on gray areas where measures for improvement are required. The Chairman also directed that inspection be made by Collectors of Customs to improve integrity amongst the work force. Member (HRM) informed the Council that a Conference is planned where 86 officers having post-graduate degree will be invited, those suitable for posting in Directorate General of Training will be identified. The meeting decided that foreign training reports will be compulsorily filed in the HRM Wing after completion of training course.

5. Member (FR&S) presented the latest position of revenue collection under various heads. It was observed that due to recent disturbances a shortfall of Rs. 35 billion is expected as of 31.12.2007. It was, however, observed that uptill November, revenue growth was 14.8% (cumulative) whereas upto December 2007, it was reduced to 4%. Total collection in December 2007 was Rs. 90 billion as against 114 billion for the same period last year. It was decided that the budgetary target of Direct Taxes will be reviewed after 14th January 2008 i.e. that last date of filing Corporate Returns. The Chairman expressed concern over shortfall in sugar and cement sectors. He instructed Member(Audit) to look into this aspect seriously and analyze the causes. It was further observed that inspite of growth in cement sector, the reason for fall in revenue must be examined and necessary steps taken immediately. The Chairman further directed Sales Tax Wing to work on valuation of imported goods. He observed that the world prices of commodity have increased manifold and there is urgent need for streamlining the values adopted by FBR field formations in respect of imported goods.

6. The meeting also decided that DG,(Withholding Tax), FBR, should hold meetings with Military/Naval/Air Accountants General to streamline the system of book adjustment. It was decided that Sales Tax Wing will undertake thorough analysis of Sales Tax filers and non-filers so that the exact position is known regarding sales tax registered persons. The Chairman directed that in order to improve performance of FBR Helpline, necessary manpower and logistic support must be made available to the FATE Wing. He also appreciated the revamped website of FBR and urged for its continuous improvement to make it more and more user friendly. It was decided that Taxpayers and Facilitation Wing must prepare a two-year activity plan along with financial layout which will be sent to Member (TP&R) for allocation of resources.

7. Financial statements as at 31st December, 2007 of TARP also presented before the Board-in-Council. The meeting expressed satisfaction over the Statements and decided to take a final decision on them after their thorough consideration in the next meeting of the Board-in-Council.

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


 5th January, 2008 FOOTWEAR MANUFACTURERS TO IMPORT DUTY-FREE SAMPLES

The Federal Government has allowed manufacturers of Footwear to import samples of raw materials, products and articles without payment of customs duty. Earlier this facility of duty free import of samples was available to manufacturer-cum-exporters only. But now Federal Board of Revenue has issued SRO 16(1)/2008 dated 4-1-2008 wherein footwear manufacturers have been allowed duty-free import of samples of an individual value not exceeding US$ 100. This measure will go a long way in helping the industry to import samples and use them in R&D work.

The SRO has already been placed on the FBR’s website: www.fbr.gov.pk

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


1st January, 2008 PAK-MALAYSIA FTA SIGNED

The Government of Islamic Republic of Pakistan and the Government of Malaysia have signed comprehensive Free Trade Agreement for closer economic partnership. This agreement to apply to trade between the two countries relating to a large number of products. Malaysian market has good potential for Pakistani exports, and can also serve as a gateway for the entire ASEAN Region. This Free Trade Agreement (FTA) with Malaysia will ensure that Pakistani products have an edge over the products of other countries in the Malaysian market. This historic and land mark Agreement is the first bilateral FTA between two Muslim countries both members of OIC; it is Malaysia’s fist such agreement with any country of South Asia and also Pakistan’s fist comprehensive Agreement with any country.

To operationalizing Pakistan-Malaysian Free Trade Agreement (FTA) from 01.01.2008. The Government of Pakistan has issued SRO 1261(1)/2007, 31.12.2007 wherein Margin of preference of 20% of existing tariff rates to 129 products has been granted. Whereas tariff on palm oil has been reduced by 10% on a margin of preference which will be reduced further 5% on 1st January, 2010. Similarly, tariff rates have been reduced ranging from 0% to 40% on more than 5000 Pakistan Customs Tariff lines.  

-Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)
 



31st December, 2007 ONLY 23 LIMITED (PUBLIC/PRIVATE) COMPANIES DE-REGISTERED: FBR CONTRADICTS PRESS REPORT

Federal Board of Revenue strongly contradicted a news item, appearing in a section of the Press under caption “More than 9,000 business companies out of tax net.” An erroneous impression was given in the news item that more than 9,000 big, medium and small companies went off the Sales Tax Registeration in 2007 out of which over 1000 were big corporate firms.
Federal Board of Revenue has thoroughly examined the matter and it was found that the said news report was misleading and incorrect. The official record shows that only 329 registered persons have been de-registered between 01-01-2007 to 19-12-2007 after due verification/audit, which includes only 23 Limited (Public/Private) Companies. This clarification is being issued for information of the general public to put the record straight.

 -Sd-
(Muhammad Hafeez Mughal)
Secretary (PR)


December 28, 2007

FBR SEMINAR POSTPONED
 

Facilitation and Taxpayer Education wing of FBR was organizing an awareness seminar in collaboration with Islamabad Chamber of Commerce and Industry on Wednesday 2nd January, 2008 at National Library auditorium, Islamabad.
Due the current situation the said seminar has been postponed and new date will be announced later.

-sd-
(Member FATE)
FBR