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Economy

Pakistanis will get 100% credit on phone top-ups for 15 days!

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ISLAMABAD: A per the order of the Supreme Court of Pakistan (SCP)  – that was told earlier that customers were getting only Rs. 61.93 on a Rs. 100 top-up –  for 15 days (starting from 12 am Thursday 14th of June, 2018) FBR and cell phone service providers will not be charging any tax on top-ups.

CJP while hearing a suo moto case noted that cellular companies were fleecing the consumers, and thus had restrained FBR and cellular companies from deducting withholding tax and other charges on top-up cards till further orders. After fifteen days a mechanism will be introduced to rationalize the amount of tax to be collected on top-ups.

Relevant pieces published earlier:

i) Suspending the exorbitant tax deductions on prepaid mobile cards the CJP has given two days for the order to be implementedHe was hearing a suo motu case at the court’s registry here today. The CJP termed Rs. 38.8.08 deduction on a Rs. 100 prepaid mobile card as illegal.  Court expressed its astonishment noting that even a laborer (who hardly manages to generate a hundred rupees a day) was asked to pay withholding tax. According to details the Apex Court had taken notice of the exorbitant taxes last May and asked all the telecommunication companies and the Attorney General of Pakistan to submit their replies on the anomaly.

ii) Federal Bureau of Revenue (FBR) on Saturday has submitted in SCP its response apropos composition of taxes deducted from mobile pre-paid top-up cards. It is pertinent to remind the readers here that SCP has ordered FBR, federal and provincial governments on 8th of May to inform why 42% worth of card was being deducted on mobile prepaid cards.  The apex court took notice of public complaints that high amount of tax and other charges were being deducted from the topping up of the balance through mobile easy load and calling cards besides taxing the calls.

It had been told that 5.5 percent was deducted as a withholding tax, 19pc as sales tax and another 10pc as services charges. FBR, attempting to justify the levying of withholding taxes on recharging, held that due to a lack of documentation of economic transactions in developing countries, the tax base and revenue collection is low, which is why withholding taxes are the main source to broaden the tax base and generate revenue. A person has the right to claim a refund if his annual tax liability is less than the tax withheld. FBR went on to claim that the same modus operandi was prevalent in many countries and taxes were lower than in many countries. (Published on 20th of May 2018)

iii) SC, taking suo motu notice of huge deductions of prepaid billing as a tax by mobile companies, has issued a notice to FBR, cellular concerns and Attorney General of Pakistan here today.CJP wants  Attorney General of Pakistan to explain as to how much and what amount is being deducted or taxed on a calling card/easy load of Rs100. According to details the three-judge bench headed by CJP, while noting a large number of complaints from people in this respect, has fixed the hearing on 8th of May. (Published on 3rd of May, 2018) 

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Crime

Pakistan improves mechanism to handle AML/CFT issues

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ISLAMABAD: The Finance Minister, Dr. Shamshad Akhtar said Friday that the Finance Ministry has improved institutional mechanisms for handling Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) issues.
Chairing a meeting here Friday in the wake of Financial Action Task Force (FATF) Plenary meeting in Paris, the Minister expressed Pakistan’s strong resolve to keep up efforts on the counter financing of terrorism.
Foreign Minister, Abdullah Hussain Haroon and National Security Advisor Lt. General (retd) Nasser Khan Janjua, were also present on the occasion.
She added that the coordination between Central Bank, banking institutions, and law enforcement agencies have also been strengthened to curb money laundering and terror financing.
She invited participants to share their views and suggestions to further strengthen measures and put in place a strong implementation mechanism in this regard.
The participants while underscoring Pakistan’s resolve to further strengthen the AML/CFT regime emphasized and agreed on the formation of a high-level implementation committee to regularly oversee progress made by different agencies and departments engaged in the drive to counter financing of terrorism.
The meeting stressed inter-governmental cooperation as well as inter-agencies coordination for better results. The meeting was also briefed on the preparations by Pakistan’s delegation scheduled to attend FATF meeting at Paris.

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Economy

Tax Amnesty Scheme receives good response

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Senate body discusses tax relief in FATA

ISLAMABAD: Tax Amnesty Scheme was receiving encouraging results and its success would help to resolve the current account deficit and balance of payment issues.

This was stated by a spokesman of Federal Board of Revenue (FBR) Dr. Muhammad Iqbal on Friday while addressing a press conference here at FBR House. Muhammad Iqbal said the number of beneficiaries under tax amnesty scheme was increasing everyday.

He said under the scheme, the people could benefit by declaring their domestic and foreign assets as they would have to pay only a nominal tax under the scheme. To a question, the spokesman said the last date of the scheme was June 30 and he did not have any authority to extend the last date of the scheme.

Iqbal said keeping in view the benefits of tax amnesty scheme, the caretaker set up was also fully committed to ensuring the success of the scheme. He said government, as well as public representatives, were not eligible to take benefit from the scheme while people involved in different crimes were also not allowed to benefit from it.

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Economy

Senate body discusses tax relief in FATA, Malakand

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Senate body discusses tax relief in FATA

ISLAMABAD: Senate Standing Committee on Finance, Revenue and Economic Affairs on Friday discussed tax exemption for commercial enterprises in Federally Administered Tribal Area (FATA), Provincially Administered Area (PATA) and Malakand Division.

The meeting of the committee was held here today under the chairmanship of Senator Farooq H. Naek and was attended by Senators Mian Muhammad Ateeq Shaikh, Muhammad Akram, Mohsin Aziz, Dilawar Khan, Khanzada Khan, Aurangzeb Khan, senior officers from the Federal Board of Revenue (FBR) and Ministry of Finance.

Senator Mirza Muhammad Afridi, Senator Fida Muhammad, and Senator Shamim Afridi were specially invited for their valuable input regarding issues that came under discussion with regards to the people of FATA, PATA and Malakand Division.

The meeting commenced with consideration of a point of public importance raised by Senator Mirza Muhammad Afridi regarding utilization of Zakat Funds in the education and health sectors and details that revealed disbursement of those funds to FATA. However, the matter was deferred since secretary ministry of Finance was not present. The Committee took strict notice of this matter.

While discussing the issue of exemption to pensioners from filing tax returns on the public petition of Major (R) Ghulam Abbas, the Committee questioned Dr. Muhammad Iqbal, Member IR Policy FBR of the circumstances under which pensioners are taxed. He revealed that under FBR rules, pensioners are not taxed unless they possess taxable movable or immovable property; or if they accept other employment after retirement.

He further stated that the petitioner was not included in the tax list. Chairman Committee, expressed satisfaction and disposed off the petition; issuing directions for the petitioner to be informed of the decision.

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