Complete Text of Pakistan Finance Bill (Budget Tax Proposals) For 2013-14

PAKISTAN FINANCE BILL 2013-14

A  BILL to give effect  to  the  financial proposals of  the Federal Government  for  the year

beginning on the first day of July, 2013, and to amend and enact certain laws WHEREAS  it  is  expedient  to  make  provisions  to  give  effect  to  the  financial proposals  of  the  Federal Government  for  the  year  beginning  on  the  first  day  of  July, 2013, and to amend certain laws for the purposes hereinafter appearing;

It is hereby enacted as follows:-

1.  SHORT  TITLE,  EXTENT  And  COMMENCEMENT.  –  (1)  This  Act  may  be  called  the Finance Act, 2013.

(2)  It extends to the whole of Pakistan. 

(3)  It shall, unless otherwise provided, come into force on the first day of July, 2013.

 

2.  AMENDMENTS OF ACT  IV OF 1969.?  In  the Customs Act, 1969  (IV of 1969),

the following further amendments shall be made, namely:-

(1)  in section 2,  in clause  (la), after  the  figure  “104”  the comma and  figure  “121” shall be inserted;

(2)  after section 3DD, the following new section shall be inserted, namely:- “3DDD.  Directorate  General  of  Input  Output  Co-efficient Organization.-  The  Director  General  of  Input  Output  Co-Efficient Organization  (IOCO)  shall  consist  of  a  Director  General  and  as  many Directors, Additional Directors, Deputy Directors, Assistant Directors and 2 such other officers as the Board may, by notification in the official Gazette, appoint.”;

 

(3)  for section 14A, the following shall be substituted; namely:- “14A.  Provision  of  security  and  accommodation  at  Customs-ports, etc.- 

 (1)  Any  agency  or  person  including  port  authorities managing  or owning a customs-port, a customs-airport or a  land customs station or a container  freight  station  shall  provide  at  its  or  his  own  cost  adequate security  and  accommodation  to  customs  staff  for  residential  purposes, offices,  examination  of  goods,  detention  and  storage  of  goods  and  for other  departmental  requirements  to  be  determined  by  the  Collector  of Customs  and  shall  pay  utility  bills,  rent  and  taxes  in  respect  of  such accommodation.

(2)  Any  agency  or  person  including  but  not  limited  to  port authorities managing  or  owning  a  customs  port,  a  customs  airport  or  a land  customs  station  or  a  container  freight  station  shall  entertain  delay and  detention  certificate  issued  by  an  officer  not  below  the  rank  of Assistant Collector of Customs and also refund demurrage charges which the  agency  or  person  has  received  on  account  of  delay  because  of  no fault of importers or exporters.”;

(4)  in  section  32,  in  sub-section  (4),  after  the  brackets  and  figure  “(3)”,  the words, figure and brackets “or sub-section (3A)” shall be inserted;

 (5)  in section 81, 3 (a)  in sub-sections (1), (2), (3), (4) and (5),  the words “or a post-dated

cheque”, wherever occurring, shall be omitted; (b)  in  the  Explanation,  for  the  words  “post-dated  cheque”  the  words “pay order” shall be substituted;

(6)  in  section  83,  in  sub-section  (2),  the  comma  and  figure  “,80A”  shall  be omitted;

 (7)  in  section  179,  in  sub-section  (1),  after  clause  (vi),  the  following  proviso shall be added, namely:- “Provided that in cases of goods to be exported, the above officers of Customs shall have their jurisdiction and powers in terms of FOB value and twice their respective monetary limit.”;

 

(8)  in section 196,  in sub-section  (1), after  the word  “Investigation” a comma and the words “, or Director of Valuation” shall be inserted;

 

(9)  in  section  202B,  for  the  words  “Pakistan  Customs  Service”,  wherever occurring,  the words  “Customs Service of Pakistan, as defined under  the Occupational  Groups  and  Services  (Probation,  Training  and  Seniority) Rules, 1990,” shall be substituted; and 

 

(10)  the amendments set out  in  the Schedule  to  this Act shall be made  in  the First Schedule to the Customs Act, 1969 (IV of 1969). 

 

3.  AMENDMENTS OF  THE SALES TAX ACT, 1990. ?  In  the Sales Tax Act, 1990,  the

following further amendments shall be made, namely:-

(1)  in section 2,– 4

(i)  after  clause  (5AB),  the  following  new  clause  shall  be  inserted, namely:-

“(5AC)  “CREST”  means  the  computerized  program  for  analyzing and cross-matching of sales  tax  returns, also  referred  to as Computerized Risk-based Evaluation of Sales Tax;”;

(ii)  for clause (22A), the following shall be substituted namely:-

“(22A) “Provincial  Sales  Tax”  means  tax  levied  under  provincial laws  or  laws  relating  to  Islamabad  Capital  Territory,  which are declared by the Federal Government through notification in  the  official  Gazette,  to  be  provincial  sales  tax  for  the purpose of input tax;”;

(iii)   after  clause  (33),  the  following  new  clause  shall  be  inserted, namely:-

“(33A)  “supply  chain”  means  the  series  of  transactions  between buyers and sellers from the stage of first purchase or import to the stage of final supply;”;

(iv)  in clause (44),-

(a)  in  sub-clause  (a),  after  the words  “recipient  of  the  supply” the words “or the time when any payment is received by the supplier  in  respect of  that supply, whichever  is earlier” shall

be inserted; and

(b)  in  sub-clause  (c),  for  the  “semicolon”  a  “colon”  shall  be substituted  and  thereafter  the  following  proviso  shall  be added, namely:- 5

“Provided  that  in  respect of sub-clause  (a),  (b) or  (c), where any part payment is received,?

(i)  for the supply in a tax period, it shall be accounted for in the return for that tax period; and

(ii)  in  respect of exempt supply,  it shall be accounted  for in  the  return  for  the  tax  period  during  which  the exemption is withdrawn from such supply;”;

 

(2)  in section 3,?

(a)  for  the word  “sixteen”, wherever  occurring,  the word  “seventeen” shall be substituted;

(b)  after  sub-section  (1),  the  following  new  sub-sections  shall  be inserted, namely:–

“(1A)  Subject to the provision of sub-section (6) of section 8 or any notification  issued  thereunder,  where  taxable  supplies  are  made  to  a person who has not obtained registration number, there shall be charged, levied  and  paid  a  further  tax  at  the  rate  of  two  per  cent  of  the  value  in addition  to  the  rate specified  in sub-sections  (1),  (1B),  (2),  (5) and  (6) of

this section: Provided  that  the  Federal Government may,  by  notification  in  the official Gazette, specify the taxable supplies in respect of which the further tax shall not  be charged, levied and paid. 6

(1B)  The Board may, by notification  in  the official Gazette,  in  lieu of  levying  and  collecting  tax  under  sub-section  (1)  on  taxable  supplies, levy and collect tax—

(a)  on the production capacity of plants, machinery, undertaking, establishments  or  installations  producing  or  manufacturing such goods; or

(b)  on fixed basis, as it may deem fit, from any person who is in a  position  to  collect  such  tax  due  to  the  nature  of  the business.”; and

(c)  in  sub-section  (5),  for  the  words  “such  extra  amount  of  tax”  the words “tax at such extra rate or amount” shall be substituted”;

 

(3)  in section 8, in sub-section (1), after clause (ca), the following new clause shall be inserted, namely:-

“(caa) purchases,  in  respect  of  which  a  discrepancy  is  indicated  by CREST or input tax of which is not verifiable in the supply chain;”;

 

(4)  in section 21,- 

(a)  in sub-section (3), the words and figure “unless the registered buyer has fulfilled his responsibilities under section 73” shall be omitted; 

(b)  after sub-section (3), the following new sub-section shall be added, namely:–

“(4)  Notwithstanding  anything  contained  in  this  Act,  where  the Board,  the  Commissioner  or  any  officer  authorized  by  the Board in this behalf has reasons to believe that a registered person is engaged in issuing fake or flying invoices, claiming fraudulent  input  tax or  refunds, does not physically exist or conduct  actual  business,  or  is  committing  any  other fraudulent activity,  the Board, Commissioner or such officer may after  recording  reasons  in writing, block  the  refunds or input  tax  adjustments  of  such  person  and  direct  the concerned  Commissioner  having  jurisdiction  for  further investigation and appropriate legal action.”;

 

(5)  in section 22, in sub-section (1),?

(a)  in clause (e), the word “and”, at the end, shall be omitted; and

(b)  after  clause  (e),  amended  as  aforesaid,  the  following  new  clause shall be inserted, namely:–

“(ea)  record  relating  to  gate  passes,  inward  or  outward,  and transport receipts.”;

 

(6)  in  section  25,  after  sub-section  (5),  the  following  explanation  shall  be

added, namely:–

“Explanation.- For  the purpose of  sections  25, 38, 38A, 38B and 45A and for removal of doubt, it is declared that the powers of the Board, Commissioner  or  officer  of  Inland  Revenue  under  these  sections  are independent  of  the  powers  of  the Board  under  section  72B  and  nothing contained in section 72B restricts the powers of the Board, Commissioner or officer of Inland Revenue to have access to premises, stocks, accounts, 8 records,  etc.  under  these  sections  or  to  conduct  audit  under  these sections.”;

 

(7)  in section 40B, after the word “Board” the words “or Chief Commissioner” shall be inserted.

 

(8)  after section 40B, the following new section shall be inserted, namely:– “40C.  Monitoring  or  tracking  by  electronic  or  other means.?

(1)  Subject  to  such  conditions,  restrictions  and  procedures,  as  it  may deem fit to impose or specify, the Board may, by notification in the official Gazette,  specify any  registered person or  class of  registered persons or any good or class of goods  in  respect of which monitoring or  tracking of production, sales, clearances, stocks or any other related activity may be implemented through electronic or other means as may be prescribed.

(2)  From  such  date  as  may  be  prescribed  by  the  Board,  no taxable goods shall be removed or sold by  the manufacturer or any other person without affixing  tax stamp, banderole, stickers,  labels, etc.  in any such  form,  style and manner as may be prescribed by  the Board  in  this behalf.”;

 

(9)  in section 45B,  in sub-section  (1),  the  following new sub-section shall be inserted, namely:–

“(1A)  Where in a particular case, the Commissioner (Appeals) is of the  opinion  that  the  recovery  of  tax  levied  under  this  Act,  shall  cause undue  hardship  to  the  taxpayer,  he,  after  affording  opportunity  of  being heard  to  the Commissioner  or  officer  of  Inland Revenue  against  whose 9 order  appeal  has  been made, may  stay  the  recovery  of  such  tax  for  a period not exceeding thirty days in aggregate.”;

 

(10)  for section 57 the following shall be substituted, namely:–

“57.  Rectification  of  mistake.?  (1)  The  Commissioner,  the Commissioner  (Appeals)  or  the  Appellate  Tribunal may,  by  an  order  in writing, amend any order passed by him  to  rectify any mistake apparent from  the record on his or its own motion or any mistake brought  to his or its notice by a  taxpayer or,  in  the case of  the Commissioner (Appeals) or the Appellate Tribunal, the Commissioner.

(2)  No  order  under  sub-section  (1)  which  has  the  effect  of increasing  an  assessment,  reducing  a  refund  or  otherwise  applying adversely  to  the  taxpayer  shall  be made  unless  the  taxpayer  has  been given a reasonable opportunity of being heard. 

(3)  Where  a mistake  apparent  on  the  record  is  brought  to  the notice of the Commissioner or Commissioner (Appeals), as the case may be,  and  no  order  has  been  made  under  sub-section  (1),  before  the expiration  of  the  financial  year  next  following  the  date  on  which  the mistake  was  brought  to  their  notice,  the  mistake  shall  be  treated  as rectified and all the provisions of this Act shall have effect accordingly.

(4)  No order under sub-section (1) shall be made after five years from the date of the order sought to be rectified.”;

 

(11)   after section 72B, the following new section shall be inserted, namely:- 10 “72C.- Reward  to  Inland Revenue officers and officials.-  (1)  In cases  involving  concealment  or  evasion  of  sales  tax  and  other taxes, cash  reward shall be sanctioned  to  the officers and officials of  Inland Revenue  for  their meritorious conduct  in such cases and to  the  informer  providing  credible  information  leading  to  such detection, as may be prescribed by the Board, only after realization of part or whole of the taxes involved in such cases. 

(2)  The  Board  may,  by  notification  in  the  official  Gazette, prescribe  the  procedure  in  this  behalf  and  specify  the apportionment of reward sanctioned under this section for individual performance or  to collective welfare of  the officers and officials of Inland Revenue.”;

 

(12)  in section 73, in the explanation, after the words “is registered” the words, letters  and  figure  “through  Form  STR  1  or  change  of  particulars  in registration database” shall be inserted;

 

(13)  in the Third Schedule, in column (1), after serial number 21 and the entries relating  thereto  in columns  (2) and  (3),  the  following new serial numbers and the entries relating thereto shall be added, namely:–

“22.  Finished or made-up articles of  textile and leather,  including  garments,  footwear,  and

bed ware, sold in retail packing

23.  Household  electrical  goods,    including  air conditioners,  refrigerators,  deep  freezers,

 televisions,  recorders and players,  electric bulbs,  tube-lights,  fans,  electric  irons, washing machines and telephone sets

24.  Household  gas  appliances,  including cooking  range,  ovens,  geysers  and  gas heaters 25.  Foam or spring mattresses, and other foam products for household use

26.  Auto  parts  and  accessories  sold  in  retail packing

27.  Lubricating  oils,  brake  fluid,  transmission fluid,  and  other  vehicular  fluids  and maintenance products in retail packing

28.  Tyres and tubes 

29.  Storage batteries 

30.  Arms and ammunition 

31.  Paints,  distempers,  enamels,  pigments, colours,  varnishes,  gums,  resins,  dyes, glazes,  thinners, blacks, cellulose  lacquers and polishes sold in retail packing

32.  Fertilizers 

33.  Cement sold in retail packing 

34.  Tiles sold in retail packing 

35.  Biscuits, confectionary, chocolates,  toffees and candies

36.  Other  goods  and  products  sold  in  retail packing

and

(14)  in the Sixth Schedule,?

(a)  in Table-1, serial number 25  in column  (1) and  the entries  relating thereto in columns (2) and (3) shall be omitted; and (b)  in Table-2, serial number 12  in column  (1) and  the entries  relating thereto in columns (2) and (3) shall be omitted.

 

4.  AMENDMENT OF ORDINANCE XLIX OF 2001.? IN THE INCOME TAX ORDINANCE, 2001 (XLIX of 2001), the following further amendments shall be made, namely:-

(1)  in section 8,in clause (e), in sub-clause (ii), for the colon a full stop shall be substituted and thereafter the proviso shall be omitted; 

 

(2)  in section 56, in sub-section (1), after the word “income”, occurring for the third  time,  the words  and  figure  “except  income  under  the  head  salary” shall be inserted;

 

(3)  in  section  59AA,  in  sub-section  (5),  after  the  word  “requirements”,  the words “ and group designation rules or regulations” shall be inserted;

 

(4)  in  section  59B,  in  sub-section  (2),  in  clause  (g),  after  the  word “requirements”,  the  words  “and  group  designation  rules  or  regulations” shall be inserted;

 

(5)  in section 80, in sub-section (2), in clause (b),- (a)  for sub-clause (v), the following shall be substituted, namely,-  

“(v)  a co-operative society, a finance society or any other society;”;

(b)  after sub-clause (v), substituted as aforesaid, the following new sub-clauses shall be inserted, namely:-

“(va)  a non-profit organization;

(vb)  a  trust,  an  entity  or  a  body  of  persons  established  or constituted by or under any law for the time being in force;”;

(6)  in section 111, in sub-section (1), for full stop, at the end, a colon shall be substituted and thereafter  the following proviso shall be added, namely:-

“Provided  that where a  taxpayer explains  the nature and source of the  amount  credited  or  the  investment made, money  or  valuable  article owned  or  funds  from  which  the  expenditure  was  made,  by  way  of agricultural  income,  such  explanation  shall  be  accepted  to  the  extent  of agricultural  income worked  back  on  the  basis  of  agricultural  income  tax

paid under the relevant provincial law.”;  

 

(7)  in section 113,- 14

(a)  in  sub-section  (1),  in  clause  (e),  for  the word  “one-half”  the word “one” shall be substituted; and

(b)  in sub-section (2),- 

(i)  in clause (b), for the word “one-half” the word “one” shall be substituted; and

(ii)  in  clause  (c), after  the    comma, occurring  for  the  first  time, the words, figures  and brackets “clause (1) of Division I, or” shall be inserted;

 

(8)  for section 113A, the following shall be substituted, namely:-

“113A. Minimum tax on builders.- (1)  Subject  to  this Ordinance, where a person derives income from the business of construction and sale of residential, commercial or other buildings, he shall pay minimum  tax at the  rate of  rupees  twenty  five per square  foot as per  the construction or site plan approved by the relevant regulatory authority. 

(2)  The minimum  tax  to be paid under  this section shall be computed on the basis of total number of square feet sold or booked for sale during the year.

(3)   The tax paid under this section shall be minimum tax on the income of  the  builder  from  the  sale  of  such  residential,  commercial  or  other building.”;

 

(9)  for section 113B the following shall be substituted, namely,-

“113B.  Minimum tax on land developers.-  (1)  Subject  to  this Ordinance,  where  a  person  derives  income  from  the  business  of 15 development  and  sale  of  residential,  commercial  or  other  plots,  he  shall pay minimum tax at the rate of rupees fifty per square yard as per the lay out or site plan approved by the relevant regulatory authority.

(2)  The tax computed under sub-section (1) shall be paid on the basis of total number of square yards sold or booked for sale during the year.

(3)  The tax paid under this section shall be minimum tax on the income of  the  developer  from  the  sale  of  such  residential,  commercial  or  other plots sold or booked.”;

 

(10)  in section 114,-

(A)  in sub-section (1), in clause (b),- 

(i)  in sub-clause (viii),-

(a)  for  the  words  “one  million”  the  words  “five  hundred thousand ” shall be substituted; and 

(b)  for  the  full  stop,  occurring  at  the  end,  a  semicolon shall be substituted; and

(ii)  after  sub-clause  (viii),  amended  as  aforesaid,  the  following new sub-clause shall be added, namely:-

“(ix)  is  registered  with  any  Chamber  of  Commerce  and Industry  or any  trade or business association  or any market committee or any professional body  including Pakistan  Engineering Council,  Pakistan Medical  and Dental  Council,  Pakistan  Bar  Council  or  any Provincial  Bar  Council,  Institute  of  Chartered Accountants  of  Pakistan  or  Institute  of  Cost  and

Management Accountants of Pakistan.”;

(B)  in  sub-section  (1A),  for  the  words  “three  hundred  and  fifty thousand” the words “four hundred thousand” shall be substituted; 

(C)  in  sub-section  (4),  after  the  word  “longer”  the  words  “or  shorter” shall be inserted; and

(D)  in sub-section (6), in clause (b), the word “and” shall be omitted and thereafter a new clause shall be inserted, namely:-

“(ba)  it is accompanied by approval of the Commissioner in writing for revision of return; and”; 

(11)  in section 115,-

(a)  sub-section (1) and the proviso thereunder shall be omitted;

(b)  for sub-section (4), the following shall be substituted, namely:-

“(4)  Any  person who  is  not  obliged  to  furnish  a  return  for a  tax year  because  all  the  person’s  income  is  subject  to  final taxation under sections 5, 6, 7, 15, 148, 151 and   152, sub-section (3) of section 153, sections 154, 156 and 156A, sub-section  (3) of section 233, sub-section  (5) of section 234 or sub-section  (3)  of  section  234A  shall  furnish  to  the Commissioner a statement showing such particulars relating to  the  person’s  income  for  the  tax  year  in  such  form  and verified in such manner as may be prescribed.”;

 

(12)  in section 116,- 17

(a)  in  sub-section  (1),  after  the  word  “person”,  occurring  for  the  first time, the words “being an individual” shall be  inserted;

(b)  in sub-section (2),- 

(i)  the  words  and  comma  “whose  last  declared  or  assessed income  or  the  declared  income  for  the  year,  is  one million rupees or more” shall be  omitted; and

(ii)  in  the  proviso,  the  words  and  commas  “whose  share  from the  income  of  such  association  of  persons,  before  tax,  for the year is one million rupees or more” shall be  omitted;

(c)  in sub-section (3), after the word “statement”, occurring for the third time,  the  words  and  comma  “along  with  the  revised  wealth reconciliation and  the  reasons  for  filing  revised wealth  statement,” shall be inserted; and

(d)  in sub-section (4),-

(i)  after  the  word  “company”,  the  words  “or  an  association  of persons” shall be inserted; and

(ii)  the words and comma “and has paid tax amounting to thirty-five  thousand  rupees  or  more  for  the  tax  year,”  shall  be omitted;

 

(13)  in section 118,-

(a)  in  sub-section  (1),  the  words,  figure  and  comma  “an  employer’s certificate under section 115,” shall be omitted;

(b)  after  sub-section  (2)  the  following  new  sub-section  shall  be inserted, namely,-

“(2A)  Where salary  income  for  the  tax year  is  five hundred thousand  rupees  or more,  the  taxpayer  shall  file  return of  income electronically in the prescribed form and it shall be accompanied by the proof of deduction or payment of  tax and wealth statement as required under section 116.”;

(c)  in sub-section (3),-

(i)  the words and comma “an Annual Statement of deduction of income  tax  from  salary,  filed  by  the  employer  of  an individual” shall be omitted; and

(ii)  for clause (a) the following shall be substituted, namely:-

“(a)   in the case of a statement required under sub-section (4)  of  section  115  or  a  return  required  to  be  filed through  e-portal  in  the  case  of  a  salaried  individual, on or before the 31st day of August next following the end  of  the  tax  year  to which  the  statement  or  return

relates; or”; and 

(d)  in sub section (6),-

(i)  the words “or employer’s certificate” shall be omitted; and (ii)  the words “or certificate”, occurring twice, shall be omitted;  

 

(14)  in section 119,-

(a)  in sub-section (1),- 19

(i)  clause (b) shall be omitted; and

(ii)  the word and comma  “certificate,”, occurring  for  the second time, shall be omitted;

(b)  in  sub-section  (2),  the words  and  comma  “employer’s  certificate,” shall be omitted; and

(c)  in sub-section (3),-

(i)  the  words  and  comma  “employer’s  certificate,”  shall  be omitted; and

(ii)  the word and comma  “certificate,”, occurring  for  the second time, shall be omitted;

 

(15)  section 120A shall be omitted;

 

(16)  in  section  122C  and  the  provisos  thereunder,  for  the  word  “sixty”, wherever occurring, the word “forty-five” shall be substituted;

 

(17)  in section 130, in sub-section (3),- 

(a)  in clause (a), the word “or”, occurring at the end, shall be omitted;

(b)  in clause  (b),  for  full stop a semicolon and  the word  “;or” shall be substituted; and

(c)  after  clause  (b),  amended  as  aforesaid,  the  following  new  clause shall be added, namely:-

“(c)  is an officer of  Inland Revenue Service and a  law graduate having at least fifteen years of service in BS-17 and above.”;

 

(18)  in sub-section 149, in sub-section (1),- 20

(a)  for the word “employer” the words “person responsible for” shall be substituted; 

(b)  after  the word “adjustment”  the words,  figures and commas “of  tax withheld  from  employee  under  other  heads  and  tax  credit admissible  under  sections  61,  62,  63  and  64  during  the  tax  year after obtaining documentary evidence, as may be necessary”, shall be omitted; and

(c)  clause (i) shall be omitted;

 

(19)  in section 152, after sub-section (7), the following new sub-section shall be added, namely,-

“(8)  In  this  section  “prescribed  person”  means  a  prescribed person as defined in sub-section (7) of section 153.”;

 

(20)  in section 153,-

(A)  in sub-section (7),-

(a)  in clause (i),-

(i)  in sub-clause (h),  the word “or”, occurring at  the end, shall be omitted;

(ii)  in  sub-clause  (i),  after  the  semi-colon  the  word  “or” shall be added; and

(iii)  after  sub-clause  (i),  amended  as  aforesaid,  the following new sub-clause shall be added, namely:-

“(j)  a person registered under the Sales Tax Act, 1990;”;

 

(21)  section 153A shall be omitted;

 

(22)  in section 155, in sub-section (3),-  (a)  in  clause  (v),  after  the  word  “organization”  the  words  “or  a charitable institution” shall be inserted;

(b)  in clause (vi), the word “or” shall be omitted; and

(c)  after clause  (vi), amended as aforesaid,  the  following new clauses shall be inserted, namely:-

“(via)  a private educational  institution, a boutique, a beauty parlour, a hospital, a clinic or a maternity home;

(vib)  individuals  or  association  of  persons  paying  gross rent of  rupees one and a half million and above  in a

year; or”;

 

(23)  in  section  164,  in  sub-section  (2),  the  words  and  figure  “and  such certificate  shall  be  treated  as  sufficient  evidence  of  the  collection  or deduction for the purposes of section 168” shall be omitted;

(24)  in section 165,- 

(a)  in sub-section (1), after  the proviso,  the  following explanation shall be added, namely:-

“Explanation.- For  the  removal  of  doubt,  it  is  clarified  that this sub-section overrides all conflicting provisions contained  in  the Protection  of  Economic  Reforms  Act,  1992  (XII  of  1992),  the Banking  Companies Ordinance,  1962  (LVII  of  1962),  the  Foreign Exchange Regulation Act,  1947  (VII  of  1947)  and  the  regulations 22 made under the State Bank of Pakistan Act,1956 (XXXIII of 1956)  , if any, on  the subject,  in so  far as divulgence of  information under section 165 is concerned.”; and

(b)  in sub-section (6), for  the semicolon a full stop shall be substituted and thereafter the proviso shall be omitted;

(25)  after section 165, the following new section shall be added, namely:-

“165A.   Furnishing  of  information  by  banks.-  (1) Notwithstanding anything contained  in any  law  for  the  time being  in  force including but not limited to the Banking Companies Ordinance, 1962 (LVII of 1962), the Protection of Economic Reforms Act, 1992 (XII of 1992), the

Foreign Exchange Regulation Act, 1947 (VII of 1947) and  the regulations  made under the State Bank of Pakistan Act,1956 (XXXIII of 1956),  if any, on  the  subject,  every  banking  company  shall  make  arrangements  to provide to the Board in the prescribed form and manner,-

(a)  online access to its central database containing details  of  its  account  holders  and  all

transactions made in their accounts; (b)  a  list  containing  particulars  of  deposits aggregating  rupees one million or more made during the preceding calendar month;

(c)  a list of payments made by any person against bills raised in respect of a credit card issued to that  person,  aggregating  to  rupees  one hundred  thousand  or  more  during  the preceding calendar month; 

(d)  a  consolidated  list  of  loans  written  off exceeding rupees one million during a calendar

year; and

(e)  a  copy  of  each Currency Transactions Report and Suspicious Transactions Report generated and submitted by  it  to  the Financial Monitoring Unit  under  the  Anti-Money  Laundering  Act, 2010 (VII of 2010).

(2)  Each  banking  company  shall  also  make arrangements  to  nominate  a  senior  officer  at  the  head  office  to coordinate  with  the  Board  for  provision  of  any  information  and documents in addition to those listed in sub-section (1), as may be required by the Board.

(3)  The banking companies and their officers shall not be liable to any civil, criminal or disciplinary proceedings against them for furnishing information required under this Ordinance.

(4)  Subject  to section 216, all  information received under this  section  shall  be  used  only  for  tax  purposes  and  kept confidential.”; 

 

(26)  in section 169, in sub-section (3), the words “other than dividend received

by a company” shall be omitted.;

 

(27)  in  section  171,  in  sub-section  (2),  after  clause  (c),  the  following

explanation shall be added, namely:-

“Explanation.- For the removal of doubt, it is clarified that where a refund  order  is made  on  an  application  under  sub-section  (1)  of  section 170,  for  the purpose of compensation,  the  refund becomes due  from  the date  refund  order  is  made  and  not  from  the  date  the  assessment  of income  treated  to  have  been made  by  the Commissioner  under  section 120.”;

(28)  in section 172, in sub-section (3), in clause (b), for the semicolon, a colon  shall  be  substituted  and  thereafter  the  following    explanation  shall  be added, namely:-

“Explanation.-  In  this clause  the expression “business connection” includes transfer of an asset or business in Pakistan by a non-resident;”;

 

(29)  in  section  177,  after  sub-section  (10),  the  following  explanation  shall  be added, namely:-

“Explanation.-  For  the  removal  of  doubt,  it  is  declared  that  the powers  of  the  Commissioner  under  this  section  are  independent  of  the powers of the Board under section 214C and nothing contained in section 214C  restricts  the  powers  of  the Commissioner  to  call  for  the  record  or documents  including  books  of  accounts  of  a  taxpayer  for  audit  and  to conduct audit under this section.”;

 

(30)  in section 178, the words and commas “Federal Excise, Sales Tax,” shall be omitted; 25

 

(31)  in section 181, in sub-section (3), for the full stop at the end a colon shall be substituted and thereafter a proviso shall be added, namely:-

“Provided  that  the Board may  in case of  individuals allow,  in place of  National  Tax  Number  use  of  Computerized  National  Identity  Card issued by the National Database and Registration Authority,.”;

 

(32)  after section 181B, the following new section shall be added, namely:-

“181C.  Displaying  of  National  Tax  Number.-  Every  person deriving  income from business chargeable  to  tax, who has been  issued a National  Tax  Number,  shall  display  his  National  Tax  Number  at  a conspicuous place at every place of his business.”;

 

(33)  in section 182, in sub-section (1), in the Table, in column (1),-

(a)  against S.No.1,- 

(i)  in column  (2),  for  the words and  figures  “Where any person fails to furnish a return of income or a statement as required under  section  115  or  wealth  statement  or  wealth reconciliation  statement  or  statement  under  section  165 within the due date” the words and figure “Where any person fails  to  furnish a  return of  income as  required under section

114  within the due date” shall be substituted;

(ii)  in column  (3),  for  the words and  figures  “Such person shall pay a penalty equal to 0.1% of the tax payable for each day of  default  subject  to  a  minimum  penalty  of  five  thousand rupees and a maximum penalty of 25% of the tax payable in respect of that tax year” the words and figures “Such person shall  pay  a  penalty  equal  to  0.1%  of  the  tax  payable  in respect of  that  tax year for each day of default subject  to   a  maximum penalty of 50% of  the  tax payable provided  that  if the  penalty  worked  out  as  aforesaid  is  less  than  twenty thousand  rupees or no  tax  is payable  for  that  tax year such person shall pay a penalty of  twenty  thousand  rupees” shall be substituted;

(iii)  in column  (4),  for  the commas,  figures and words  “,115,116 and 165” the word and figures “and 118” shall be substituted;

(b)  after  S.No.1,  amended  as  aforesaid,  the  following  new  serial

numbers and the entries relating thereto in columns (2), (3) and (4)

shall be inserted, namely:-

“1A.  Where any person fails to furnish a statement as required under section 115, 165 or 165A within the due date. Such person shall pay a penalty of Rs.2500 for each day of default subject to  a minimum penalty of  fifty thousand rupees:

115, 165 and  165A

1AA.  Where any person fails to furnish  wealth statement or wealth reconciliation statement.

 Such person shall pay a penalty of Rs.100 for each day of default.  114, 115 and 116”;

(c)  against S.No.8,-

(i)  in paragraph  (a),  in column  (3),  for  the word  “five”  the word “twenty-five” shall be substituted;

(ii)  in paragraph  (b),  in column  (3),  for  the word  “ten”  the word “fifty” shall be substituted; and

(iii)  in paragraph (c), in column (3), for the word “fifty” the words “one hundred” shall be substituted;

(d)  against S.No.9, in column (3),- 

(i)  for the word “five” the word “twenty-five” shall be substituted; 

(ii)   for the word “ten” the word “fifty” shall be substituted; and

(e)  after  S.No.15,  the  following  new  serial  number  and  the  entries

relating  thereto  in  columns  (2),  (3)  and  (4)  shall  be  added,

namely:-  

“16.  Any person who fails to  display  NTN Certificate  at  the place of business as required  under  this Ordinance  or  the rules  made thereunder. Such person shall pay  a penalty of five thousand rupees.

181C”;

(34)  in  section  210,  in  sub-section  (1),  for  the words  and  comma,  “Officer  of Inland  Revenue,  subordinate  to  the  Commissioner”  the  words  and commas  “Additional  Commissioner,  Deputy  Commissioner,  Assistant Commissioner or Inland Revenue Officer” shall be substituted; 

 

(35)  in section 214C,-

(a)  after sub-section (1), the following new sub-section shall be added, namely:-

“(1A)  Notwithstanding anything contained  in  this Ordinance or any other  law,  for  the  time being  in  force,  the Board shall keep the parameters confidential”; and

(b)  after  sub-section  (3),  the  following  explanation  shall  be  added, namely:-

“Explanation.- For  the  removal of doubt,  it  is declared  that the  powers  of  the  Commissioner  under  section  177  are independent  of  the  powers  of  the  Board  under  this  section  and 29 nothing  contained  in  this  section  restricts  the  powers  of  the Commissioner  to call  for  the  record or documents  including books of  accounts  of  a  taxpayer  for  audit  and  to  conduct  audit  under section 177.”;

 

(36)  after section 227, the following new section shall be inserted, namely:-

“227A.- Reward  to  Inland Revenue officers and officials.  (1)  In cases  involving  concealment  or  evasion  of  income  tax  and  other  taxes, cash  reward  shall  be  sanctioned  to  the  officers  and  officials  of  Inland Revenue  for  their meritorious conduct  in such cases and  to  the  informer providing  credible  information  leading  to  such  detection,  as  may  be prescribed by the Board, only after realization of part or whole of the taxes involved in such cases.

 (2)  The  Board  may,  by  a  notification  in  the  official  Gazette, prescribe  the  procedure  in  this  behalf  and  specify  the  apportionment  of reward  sanctioned  under  this  section  for  individual  performance  or  to collective welfare of the officers and officials of Inland Revenue.”;

 

(37)  in Chapter XI,-

(a)  in  Part  II,  for  the  heading  “DIRECTORATE-GENERAL  OF INTERNAL  AUDIT”  the  heading  “DIRECTORATES-GENERAL” shall be substituted; and

(b)  in  Part  III,  for  the  heading  “DIRECTORATE-GENERAL  OF WITHHOLDING  TAXES”  the  heading  “DIRECTORATES-GENERAL” shall be substituted; 

 

(38)  after section 230A, the following new sections shall be inserted, namely:-

“230B.  Directorate-General  of  Law.  —  (1)  The  Directorate- General of Law shall consist of a Director General and as many Directors, Additional  Directors,  Deputy  Directors,  Assistant  Directors,  Law Officers and  such  other  officers  as  the  Board may,  by  notification  in  the  official Gazette, appoint.

(2)  The Board may, by notification in the official Gazette, specify the functions, jurisdiction and powers of the Directorate- General of Law.

230C.  Directorate-General  of  Research  and Development.-(1)  The  Directorate-General  of  Research  and Development  shall  consist  of  a  Director  General  and  as  many Directors,  Additional  Directors,  Deputy  Directors,  Assistant Directors and such other officers as  the Board may, by notification in the official Gazette, appoint.

(2)  The Board may, by notification  in  the official Gazette, specify  the  functions,  jurisdiction  and  powers  of  the  Directorate-General of Research and Development.”;

 

(39)  in section 233AA,- 

(a)  after  the  word  “Pakistan”,  the  words  and  commas  “  ,margin financiers, trading financiers and lenders” shall be inserted;

(b)  after  the word “business”,  the words,  figure, brackets and commas “or providing of any margin  financing, margin  trading or  securities ending under Securities (Leveraged Markets and Pledging) Rules, 2011 in share business” shall be inserted; and

(c)  for the letters “IIA” the letters “IIB” shall be substituted;

 

(40)  in section 234,-

(a)  in  sub-section  (1),  after  the  word  “in”  the  words  and  letters  “ Division III of” shall be inserted; 

(b)  in sub-section (2),- 

(i)  for the comma, occurring first, the words “or lump sum” shall be substituted; and

(ii)  after  the  word  “installment”,  occurring  for  the  second  time, the words “or lump sum” shall be inserted;

(c)  for sub-section (5) the following shall be substituted, namely:- “ (5)   Advance  tax  collected  under  this  section  shall  be adjustable.”;

 

(41)  after section 236C, the following new section shall be inserted, namely:-

“236D.  Advance  tax  on  functions  and  gatherings.-  (1)  Every prescribed person shall collect advance tax at the rate specified in Division XI of Part  IV of  the First Schedule on  the  total amount of  the bill    from a person arranging or holding a function in a marriage hall, marquee, hotel, restaurant, commercial lawn, club,  a community place or any other place used for such purpose. 

(2)  Where  the  food,  service or any other  facility  is  provided by any other person, the prescribed person shall also collect advance tax on the  payment  for  such  food,  service  or  facility  at  the  rate  specified  in Division XI of Part  IV of  the First Schedule  from  the person arranging or holding the function.

(3)  The  advance  tax  collected  under  sub-section  (1)  and  sub-section (2) shall be adjustable.

(4)  In this section,- 

(a)  “function”  includes  any  wedding  related  event,  a seminar,  a  workshop,  a  session,  an  exhibition,  a concert, a  show, a party or any other gathering held for such purpose; and 

(b)  “prescribed  person”  includes  the  owner,  a  lease-holder, an operator or a manager of a marriage hall, marquee, hotel,  restaurant,  commercial  lawn,  club, a community  place  or  any  other  place  used  for  such purpose. 

“236E.   Advance  tax on  foreign-produced  films, TV plays and serials.-

 (1)    Any  person  responsible  for  censoring  or certifying a  foreign-produced  film, a TV drama serial or a play,  for screening and viewing, shall, at  the  time of censoring or certifying, collect advance tax at the rates specified in Division XII of Part IV of the First Schedule.

(2)  The advance tax collected under sub-section (1) shall be adjustable. 

 

236F. Advance  tax  on  cable  operators  and  other electronic  media.-  (1)  Pakistan  Electronic  Media  Regulatory Authority, at the time of issuance of  license for distribution services or renewal of the  license to a licensee, shall collect advance tax at the rates specified in Division XIII of Part IV of the First Schedule. (2)  The  tax  collected  under  sub-section  (1)  shall  be adjustable.

(3)  For  the  purpose  of  this  section,  “cable  television  operator”,  “DTH”,  “Distribution Service”,  “electronic media”,  “IPTV”, “loop holder”, “MMDS”, “mobile TV”, shall have the same meanings as  defined  in    Pakistan  Electronic  Media  Regulatory  Authority Ordinance,  2002  (XIII  of  2002)  and  Pakistan  Electronic  Media Regulatory Authority Rules, 2009.

 

236G. Advance  tax on sales  to distributors, dealers and wholesalers.-  (1)  Every  manufacturer  or  commercial  importer  of electronics,  sugar,  cement,  iron  and    steel  products,  fertilizer,

motorcycles, pesticides,  cigarettes, glass,  textile, beverages, paint or  foam  sector,  at  the  time  of  sale  to  distributors,  dealers  and wholesalers,  shall  collect  advance  tax  at  the  rate  specified  in Division  XIV  of  Part  IV  of  the  First  Schedule,  from  the  aforesaid person to whom such sales have been made.

(2)  Credit for the tax collected under sub-section (1) shall be  allowed  in  computing  the  tax  due  by  the  distributor,  dealer  or wholesaler on  the  taxable  income  for  the  tax year  in which  the  tax was collected.

236H. Advance  tax  on  sales  to  retailers.-  (1)  Every manufacturer,  distributor,  dealer,  wholesaler  or  commercial importer  of  electronics,  sugar,  cement,  iron  and  steel  products,

fertilizer,  motorcycles,  pesticides,  cigarettes,  glass,  textile, beverages,  paint  or  foam  sector,  at  the  time  of  sale  to  retailers, shall collect advance tax at the rate specified in Division XV of Part IV of  the First Schedule,  from  the aforesaid person  to whom such sales have been made.

(2)   Credit for the tax collected under sub-section (1) shall be allowed  in computing  the  tax due by  the  retailer on  the  taxable income for the tax year in which the tax was collected.

236I.  Collection  of  advance  tax  by  educational institutions.-  (1) There shall be collected advance  tax at  the  rate specified  in  Division  XVI  of  Part-IV  of  the  First  Schedule  on  the

amount of fee paid to an educational institution.

(2)  The  person  preparing  fee  voucher  or  challan  shall charge advance  tax under sub-section (1)  in  the manner the fee  is charged.

(3)  Advance  tax under  this section shall not be collected from  a  person  where  annual  fee  does  not  exceed  two  hundred thousand rupees.

(4)  The  term  “fee”  includes,  tuition  fee  and  all  charges received  by  the  educational  institution,  by  whatever  name  called, excluding the amount which is refundable.

(5)  Tax  collected  under  this  section  shall  be  adjustable against  the  tax  liability of either of  the parents or guardian making payment of the fee.

236J. Advance  tax on dealers, commission agents   and arhatis etc.-   (1) Every market committee shall collect advance  tax from  dealers,  commission  agents  or  arhatis,  etc.  at  the  rates specified  in Division  XVII  of  Part-IV  of  the  First  Schedule    at  the time of issuance or renewal of licences. 

(2)  The advance tax collected under sub-section (1) shall be adjustable.

(3)  In  this  section  “market  committee”  includes  any committee or body  formed under any provincial or  local  law made for  the  purposes  of  establishing,  regulating  or  organizing agricultural, livestock and other commodity markets.”; and

(42)  in section 239B, after  the word “thereunder”,  the words “and  in any other law  in  force  at  the  time  of  promulgation  of  this  Ordinance”  shall  be inserted.

 

(43)  in the FIRST SCHEDULE,-

(I)  in Part I,-

(A)  in Division I,- 36

(i)  in  clause  (1),  for  the  TABLE  the  following  shall  be substituted, namely:-

“TABLE

S.No.  Taxable income  Rate of tax
1 Where the taxable income does not exceed  Rs.400,000  0%
2 Where the taxable income  exceeds  Rs.400,000 but does not exceed Rs.750,000  10% of the amount  exceeding Rs.400,000 
3 Where the taxable income  exceeds  Rs.750,000 but does not exceed Rs.1,500,000  Rs.35,000 + 15% of the amount  exceeding  Rs.750,000
4 Where the taxable income  exceeds  Rs.1,500,000 but does not exceed Rs.2,500,000  Rs.147,500 + 20% of the amount exceeding Rs.1,500,000 
5 Where the taxable income  exceeds  Rs.2,500,000 but does not exceed Rs.4,000,000 Rs.347,500 + 25% of the amountexceeding  Rs.2,500,000 
6 Where the taxable income  exceeds  Rs.4,000,000 but does not exceed Rs.6,000,000 Rs. 722,500 + 30% of the amount exceeding Rs.4,000,000 
7 Where the taxable income  exceeds  Rs.6,000,000   Rs. 1,322,500 + 35% of the amount exceeding Rs.6,000,000”;

 

and 

(ii)  in clause (1A),- 

(a)  for  the  TABLE  the  following  shall  be substituted, namely:-

“TABLE S.No.  Taxable income.  Rate of tax.

(1)  (2)  (3)

S.No.  Taxable income  Rate of tax
1 Where the taxable income does not exceed Rs.400,000 0%
2 Where the taxable income  exceeds Rs.400,000 but does not exceed Rs.500,000 5% of the amount exceeding Rs.400,000 
3 Where the taxable income  exceeds Rs.500,000 but does not exceed Rs.800,000  Rs.5,000 + 7.5% of the amount exceeding Rs.500,000 
4 Where the taxable income  exceeds Rs.800,000 but does not exceed Rs.1,300,000 Rs.27,500 + 10% of the amount exceeding Rs.800,000 
5 Where the taxable income  exceeds Rs.1,300,000 but does not exceed Rs.1,800,000 Rs.77,500 + 12.5% of the amount exceeding Rs.13,00,000 
6 Where the taxable income  exceeds Rs.1,800,000 but does not exceed Rs.2,200,000  Rs.140,000 + 15% of the amount exceeding Rs.1,800,000 
7 Where the taxable income  exceeds Rs.2,200,000 but does not exceed Rs.2,600,000  Rs.200,000 + 17.5% of the amount exceeding  Rs.2,200,000  
8 Where the taxable income  exceeds Rs.2,600,000 but does not exceed  Rs.3,000,000 Rs.270,000 + 20% of the amount exceeding Rs. 2,600,000 
9 Where the taxable income  exceeds Rs.3,000,000 but does not exceed  Rs.3,500,000  Rs.350,000 + 22.5% of the amount exceeding  Rs. 3,000,000 
10 Where the taxable income  exceeds Rs.35,00,000  but does not exceed Rs.4,000,000  Rs. 462,500 + 25% of the amount exceeding  Rs.3,500,000  
11 Where the taxable income  exceeds Rs.40,00,000 but does not exceed Rs.7,000,000  Rs.587,500 + 27.5% of amount exceeding the 4,000,000  
12 Where the taxable income  exceeds Rs.7,000,000   Rs.1,412,500 + 30% of the amount exceeding  Rs.7,000,000” 

(b)  the first proviso shall be omitted;

(B)  Division IA shall be omitted;

(C)   in Division  II,  in  clause  (i),  for  full  stop  at  the  end  a  colon shall be substituted and thereafter the following proviso shall be added, namely:- “Provided  that  the rate of  tax  imposed on  the  taxable income of a  company other  than a banking  company,  shall

be 34% for the tax year 2014.”;

(D)  in Division VI,- 

(i)  in paragraph (a), in the table, in the first column,-

(a)  against  S.No  (4),  for  the  entry  in  the  second column the words, letters, figures and full stops “Where  the  gross  amount  of  rent  exceeds Rs.1,000,000  but  does  not  exceed

Rs.2,000,000.”, shall be substituted; and (b)  after  S.No  (4),  amended  as  aforesaid,  the

following  new  serial  numbers  and  entries relating  thereto  in  the  second  and  third

columns shall be added, namely:-

“(5)  Where the gross amount of rent exceeds Rs.2,000,000 but does not exceed Rs.3,000,000.

Rs.157, 500 plus 12.5 per cent of the gross amount of rent exceeding    Rs.2, 000,000.

(6)  Where the gross amount of rent exceeds Rs.3,000,000 but does not exceed Rs.4,000,000.

Rs.282, 500 plus 15 per cent of the gross amount of rent exceeding Rs.3, 000,000.

(7)  Where the gross amount of rent exceeds Rs.4,000,000. Rs.432, 500 plus 17.5 per cent of the gross amount of rent exceeding Rs.4, 000,000.”;

(ii)  in paragraph (b), in the table, in the first column,-

(a)  against S.No.  (3),  for  the entry    in  the second column  (2),  the words,  letters,  figures  and  full stops  “Where  the  gross  amount  of  rent exceeds  Rs.1,000,000  but  does  not  exceed Rs.2,000,000.” shall be substituted; and

(b)  after  S.No  (3),  amended  as  aforesaid,  the following  new  serial  numbers  and  the  entries relating  thereto  in  the  second  and  third columns shall be added, namely:-

“(4)  Where the gross amount of rent exceeds Rs.2,000,000 but does not exceed Rs.3, 000,000.

Rs.165,000 plus 12.5 per cent of the gross amount of rent exceeding  Rs.2, 000,000.

(5)  Where the gross amount of rent exceeds Rs.3,000,000 but does not exceed Rs.4, 000,000.

Rs.290,000 plus 15 per cent of the gross amount of rent exceeding Rs.3,000,000.

6)  Where the gross amount of rent exceeds Rs.4,000,000.

Rs.440,000 plus 17.5 per cent of the gross amount of rent exceeding Rs.4,000,000.”;

(II)  in Part II, for the figure, words and full stop “5% of the value of goods.” the

following shall be substituted, namely:-

“,-

(a)  5%  of  the  value  of  goods  in  the  case  of  industrial undertakings; 

(b)  5% in all other cases of companies; and

(c)  5.5% in case of all taxpayers other than those covered at (a) and (b) above.”;

(III)  in Part III,- 

(a)  in Division III,- 

(i)  in paragraph (1), for sub-paragraph (b) the following shall be substituted, namely:- 

“(b)  in the case of sale of goods,-   (i)  3.5% of  the gross amount payable  in  the case

of companies; and

(ii)  4% of the gross amount payable in the case of other taxpayers.”;

(ii)  in paragraph (2), for sub-paragraph (ii) the following shall be substituted, namely:- 

“(ii)  in the case of rendering of or providing of services,-  

(a)  6% of the gross amount payable in the case of companies; and

(b)  7% of the gross amount payable in the case of other taxpayers.”;

(iii)  in paragraph  (3),  for  the    figure, words and  full stop  “6% of the  gross  amount  payable.”  the  following  shall  be substituted, namely,-

“,-

(i)  “6%  of  the  gross  amount  payable  in  the  case  of companies; and

(ii)  6.5% of the gross amount payable in the case of other taxpayers.”;

(b)  in Division V,-

(i)  in paragraph (a), in the table, in first column,- a.  against S.No.  (4),  for  the entry  in second column  the following shall be substituted, namely:-

“Where  the  gross  amount  of  rent  exceeds Rs.1,000,000  but  does  not  exceed Rs.2,000,000.”;

b.  after S.No.  (4),  amended  as  aforesaid,  the  following new serial numbers and entries relating thereto in the second and third columns shall be added, namely:-

“(5)  Where the gross amount of rent exceeds Rs.2,000,000 but does not exceed Rs.3,000,000.

Rs.157, 500 plus 12.5 per cent of the gross amount of rent exceeding Rs.2,000,000.

(6)  Where the gross amount of rent exceeds Rs.3,000,000 but does not exceed Rs.4,000,000.

Rs.282, 500 plus 15 per cent of the gross amount of rent exceeding Rs.3,000,000.

(7)  Where the gross amount of rent exceeds Rs.4,000,000.

Rs.432, 500 plus 17.5 per cent of the gross amount of rent exceeding Rs.4,000,000.”;

(ii)  in para (b),-

a.  against S.No.  (3),  for  the entry  in second column  the following shall be substituted, namely:- 

“Where  the  gross  amount  of  rent  exceeds Rs.1,000,000  but  does  not  exceed Rs.2,000,000.”; b.  after S.No.  (3),  amended  as  aforesaid,  the  following new serial numbers and entries relating thereto  in the second and third columns shall be added, namely:-

“(4)  Where the gross amount of rent exceeds Rs.2,000,000 but does not exceed     Rs.3,000,000.

Rs.165, 000 plus 12.5 per cent of the gross amount of rent exceeding    Rs.2,000,000.

(5)  Where the gross amount of rent exceeds  Rs.3,000,000 but does not exceed     Rs.4,000,000.

Rs.290, 000 plus 15 per cent of the gross amount of rent exceeding    Rs.3,000,000.

(6)  Where the gross amount of rent exceeds Rs.4,000,000.

Rs.440, 000 plus 17.5 per cent of the gross amount of rent exceeding  Rs.4,000,000.”; and

c.  in Division VI,  in paragraph (1), for the figure “10” the figure “15” shall be substituted;

(IV)  in Part IV,- 

(a)  in Division IIA, in the table, S. No. (iv) and the entries relating thereto in the second and third columns shall be omitted;

(b)  after Division IIA, amended as aforesaid, the following new Division shall be inserted namely:-

“Division IIB

Rates for collection of tax by NCCPL The rate of deduction under section 233AA shall be 10% of profit or mark-up  or  interest  earned  by  the  member,  margin  financier  or securities lender.”;

(c)  in Division III, after paragraph (3), the following new paragraph shall be added, namely:-

“(4)  where the motor vehicle tax is collected in lump sum,-

(a)  Upto 1000cc   Rs. 7,500 

(b)   1001cc to 1199cc   Rs. 12,500 

(c)   1200cc to 1299cc   Rs. 17,500 

(d)   1300cc to 1599cc   Rs. 30,000 

(e)   1600cc to 1999cc   Rs. 40,000 

(f)   2000cc and above   Rs. 80,000”; 

(d)  in Division VI, for the figure “0.2” the figure “0.3” shall be substituted;

(e)  for Division VII the following shall be substituted, namely:-

“DIVISION VII

PURCHASE OF MOTOR CARS AND JEEPS

The rate of payment of  tax under section 231B shall be as follows:–

Engine capacity  Amount of tax 

upto 850cc  Rs.10,000

851cc to 1000cc  Rs.20,000

1001cc to 1300cc  Rs.30,000

1301cc to 1600cc  Rs.50,000

1601cc to 1800cc  Rs.75,000

1801cc to 2000cc  Rs.100,000

Above 2000cc  Rs.150,000”;

(f)  in Division VIII, for the figure “5” the figure “10” shall be substituted;

(g)  after Division X, the following new Divisions shall be added,  namely:-

“DIVISION XI

Advance tax on functions and gatherings

The rate of tax to be collected under each sub-sections (1) and (2) of section 236D shall be 10%.

  DIVISION XII

Advance tax on foreign-produced films and TV plays

Rate of collection of tax under section 236E shall be as follows: –

(a)  Foreign-produced film  Rs. 1,000,000/-

(b)  Foreign-produced  TV drama serial Rs.100,000/-per episode

(c)  Foreign-produced TV play (single episode) Rs. 100,000

Division XIII 

(1)  The rate of tax to be collected under section 236F in the case of Cable Television Operator shall be as follows:-

License Category as provided in PEMRA Rules 2009

 

Tax on License Fee

Tax on Renewal

H  Rs.7,500  Rs.10,000

H-1  Rs.10,000  Rs.15,000 50

H-II  Rs.25,000  Rs.30,000

R  Rs.5,000  Rs.30,000

B  Rs.5,000  Rs.40,000

B-1  Rs.30,000  Rs.50,000

B-2  Rs.40,000  Rs.60,000

B-3  Rs.50,000  Rs.75,000

B-4  Rs.75,000  Rs.100,000

B-5  Rs.87,500  Rs.150,000

B-6  Rs.175,000  Rs.200,000

B-7  Rs.262,500  Rs.300,000

B-8  Rs.437,500  Rs.500,000

B-9  Rs.700,000  Rs.800,000

B-10  Rs.875,500  Rs.900,000

(2)  The  rate of  tax  to be collected under section 236F  in the  case  of  other  Distribution  Services  shall  be  as follows:-

Type  of  Channel as  provided  in PEMRA Rules 2009

 

Tax on  Issuance of license Tax  on Renewal 

IPTV  Rs.100,000  Rs.1,000,000

FM Radio  Rs.100,000  Rs.100,000

MMDS  Rs.200,000  Rs.100,000

Mobile TV  Rs.100,000  Rs.50,000

Satellite TV station 51

News or Current  Rs.1,000,000  Rs.2,000,000

Sports  Rs.1,000,000  Rs.1,000,000

Regional Language  Rs.700,000  Rs.700,000

Health or Agro  Rs.300,000  Rs.300,000

Education  Rs.300,000  Rs.300,000

Entertainment  Rs.1,000,000  Rs.1,000,000

Specialized subject

station  Rs.500,000  Rs.200,000

Landing Rights per channel

News/Current

Affairs

Rs.1,000,000  Rs.5,000,000

Sports  Rs.500,000  Rs.2,500,000

Educational  Rs.200,000  Rs.1,000,000

Entertainment  Rs.200,000  Rs.2,000,000

Children  Rs.350,000  Rs.1,500,000;

Division XIV

Advance  tax  on  sale  to  distributors,  dealers  or wholesalers

The rate of collection of  tax under section 236G shall be 0.1% of the gross amount of sales.

Division XV 

Advance tax on sale to retailers

The rate of collection of  tax under section 236H shall be 0.5% of the gross amount of sales.

Division XVI 

Collection  of  advance  tax  by  educational institutions  The  rate of  collection of  tax  under  section 236I  shall be 5% of the amount of fee.

Division XVII 

Advance  tax on dealers,  commission  agents  and arhatis, etc.

The  rate of collection of  tax under section 236J shall be as follows:-

Group  Amount of tax 

(per annum)

Group or Class A:  Rs. 10,000 

Group or Class B:  Rs. 7,500 

Group or Class C:  Rs. 5,000 

Any other category:  Rs. 5,000.”;

(44)  in the SECOND SCHEDULE,-

(a)  in Part I,-

(i)  in clause (53A), sub-clause (i)  shall be omitted; 

(ii)  sub-clause (xxviii) shall be re-numbered as (xxviiia);

(iii)  sub-clause (xxix) shall be re-numbered as (xxixa); 53

(iv)  clauses (92), (98A) and (103B) shall be omitted; and

(v)  for clause (126E), the following shall be substituted, namely:-

“(126E)  income derived by a zone enterprise as   defined  in Special Economic Zones Act ,2012 (XX of 2012) for a period of ten years starting from the date the developer certifies that the  zone  enterprise  has  commenced  commercial  operation and for a period of ten years to a developer of zone starting from  the  date  of  signing  of  the  development  agreement  in the  special  economic  zone  as  announced  by  the  Federal Government.”;

(b)  in Part II, after clause (27), the following new clause shall be inserted, namely,-

“(28)  The  rate  of  tax  under  section  148  on  import  of hybrid  cars shall be reduced as below:- Engine capacity  Rate of  reduction

Up to 1200 cc  100%

1201 to 1800 cc  50%

1801 to 2500 cc      25 %”;

 

(c)  in Part III,-

(i)  clauses (1) and (2) shall be omitted;

(ii)  in clause (7), for the word “company” the word “taxpayer” shall be substituted;

(d)  in Part IV,- 

(i)  after clause (56) the following new clause (56A) shall be added, namely:-

“(56A) The  provisions  of  sub-section  (7)  of  section 148 and  clause  (a) of  sub-section  (1) of  section 169 shall not apply to a person who is liable to withholding tax under section 236E.”;

(ii)  in clause (59), in sub-clause (iv),paragraph (a) shall be omitted;

(iii)  after clause (72) the following new clauses shall be added, namely:-

“(72A)  The  provisions  of  clause  (l)  of  section  21, sections 113 and 152 shall not apply in case of a Hajj Group Operator in respect of Hajj operations provided that the tax has been paid at the rate of Rs.3,500 per Hajji  for  the  tax year 2013 and Rs.5,000 per Hajji  for the  tax  year  2014  in  respect  of    income  from  Hajj operations.

(72B)  the provisions of section 148 shall not apply  to an  industrial  undertaking  if  the  tax  liability  for  the current  tax  year,  on  the  basis  of  determined  tax liability  for  any  of  the  preceding  two  tax  years, whichever  is  the  higher,  has  been  paid  and  a  certificate  to  this  effect  is  issued  by  the  concerned Commissioner.”

(45)  in the THIRD SCHEDULE, in PART II, in clause (1), for the figure “50” the figure “25” shall be substituted; and 

(46)  in  the SEVENTH SCHEDULE  ,  in  rule  6,  in  the  second  proviso,  for  the words  and  figures  “and  at  the  rate  of  35%  for  tax  year  2014”  shall  be omitted.

 

5.  AMENDMENTS OF  THE FEDERAL EXCISE ACT, 2005. ?  IN  THE FEDERAL EXCISE ACT,

2005, the following further amendments shall be made, namely:-

(1)  in section 3, after sub-section  (3),  the  following new sub-section shall be inserted, namely:

“(3A)  Subject to the provision of sub-section (3) of section 6 or any notification  issued  thereunder,  where  excisable  goods  and  services  are supplied  to  a  person  who  has  not  obtained  registration  number,  the Federal  Government  may,  by  notification  in  the  official 

Gazette,  charge,  levy  and  collect,  on  the  excisable  goods  and  services specified in that notification, a further duty at the rate of two per cent of the value in addition to the rate specified in sub-sections (1), (3), (4) and (5) of this section.”;

(2)  in section 17,  in sub-section (1), after clause (d)  the following new clause shall be inserted, namely:-

“(da)  record  relating  to  gate  passes,  inward  or  outward,  and  transport receipts;”;

(3)  in section 33, after sub-section (1), the following new sub-section shall be inserted, namely:–

“(1A)  Where in a particular case, the Commissioner (Appeals) is of the  opinion  that  the  recovery  of  tax  levied  under  this  Act,  shall  cause undue  hardship  to  the  taxpayer,  he,  after  affording  opportunity  of  being heard  to  the Commissioner  or  officer  of  Inland Revenue  against  whose order  appeal  has  been made, may  stay  the  recovery  of  such  tax  for  a period not exceeding thirty days in aggregate.”;

(4)  in  section  35,  after  sub-section  (3),  the  following  explanation  shall  be added, namely:–

“Explanation.- For  the purpose of sections 35, 45 and 46 and  for removal  of  doubt,  it  is  declared  that  the  powers  of  the  Board, Commissioner  or  officer  of  Inland  Revenue  under  these  sections  are independent  of  the  powers  of  the Board  under  section  42B  and  nothing contained in section 42B restricts the powers of the Board, Commissioner or  officer  of  Inland  Revenue  under  these  sections  or  to  conduct  audit under these sections.”;

(5)  after section 42B the following new section shall be inserted, namely:-

“42C. Reward  to  Inland Revenue  officers  and officials.-  (1)  In cases  involving  concealment  or  evasion  of  excise  duty  and  other taxes, cash  reward shall be sanctioned  to  the officers and officials of  Inland Revenue  for  their meritorious conduct  in such cases and to  the  informer  providing  credible  information  leading  to  such detection, as may be prescribed by the Board, only after realization of part or whole of the taxes involved in such cases. 

(2)  The  Board  may,  by  notification  in  the  official  Gazette, prescribe  the  procedure  in  this  behalf  and  specify  the apportionment of reward sanctioned under this section for individual performance or  to collective welfare of  the officers and officials of Inland Revenue.”;

(6)  In  section  45,  in  sub-section  (2),  after  the  word  “Board”,  the  words  “or Chief Commissioner” shall be inserted;

(7)  after section 45, the following new section shall be inserted, namely:–

“45A.  Monitoring  or  tracking  by  electronic  or  other means.?

(1) Subject to such conditions, restrictions and procedures as it may deem fit  to  impose  or  specify,  the  Board  may,  by  notification  in  the  official Gazette,  specify any  registered person or  class of  registered persons or any goods or class of goods  in respect of which monitoring or tracking of production, sales, clearances, stocks or any other related activity may be implemented through electronic or other means as may be prescribed.

(2)  From  such  date,  as  may  be  prescribed  by  the  Board,  no excisable  goods  shall  be  removed  or  sold  by  the  manufacturer  or  any other person without affixing tax stamp, banderole, stickers, labels, etc. in any such  form, style and manner as may be prescribed by  the Board  in this behalf.”;

(8)  in the First Schedule,– 58 (a)  in Table I, in column (1),–

(i)  against serial numbers 4, 5 and 6, in column (4), for the word “six”, the word “nine” shall be substituted; 

(ii)  for serial numbers 9 and 10 and  the entries  relating  thereto in columns (2), (3) and (4), the following shall be substituted, namely:–

“9.  Locally  produced cigarettes  if  their  on-pack  printed  retail

price  exceeds  rupees two  thousand  two hundred and eighty six per  thousand cigarettes

24.02  Rupees two thousand three hundred and twenty five per thousand cigarettes

10.  Locally  produced cigarettes  if  their  on-pack  printed  retail price does not exceed rupees  two  thousand two  hundred  and eighty  six  per thousand cigarettes

24.02  Rupees eight hundred and eighty per thousand cigarettes”;

(iii)  serial number 11 and the entries relating  thereto  in columns

(2), (3) and (4) shall be omitted;  and  (iv)  after  serial  number  53  and  the  entries  relating  thereto  in columns  (2),  (3)  and  (4),  the  following  new  serial  numbers and the entries relating thereto shall be added, namely:–

“54.  Oilseeds  Respective headings Forty paisa per kg

55.  Motor  cars,  SUVs  and other  motor  vehicles  of cylinder capacity of 1800 cc  or  above,  principally designed  for  the transport  of  persons (other  than  those  of headings  87.02),

including  station  wagons and  racing  cars  of cylinder capacity of 1800 cc or above. 

87.03  Ten per cent ad.val.”; and 

(b)  in Table II,  in column (1),–

(i)  serial number 7 and  the entries  relating  thereto  in  columns (2), (3) and (4) shall be omitted; and (ii)  for  serial  number  8  and  the  entries  relating  thereto  in

columns  (2),  (3)  and  (4)  the  following  shall  be  substituted,

namely:–

“8.  Services  provided  or  rendered by  banking  companies, insurance  companies, cooperative  financing  societies, modarabas, musharikas, leasing companies,  foreign  exchange dealers,  non-banking  financial institutions, Assets Management Companies  and  other  persons dealing in any such services.

98.13 Sixteen per cent of the charges.”;

(9)  in the Third Schedule,–

(a)  in Table I, in column (1), serial numbers 5, 7 and 8 and the entries relating thereto in columns (2) and (3) shall be omitted; and

(b)  in Table-II,  in column  (1), serial number 8 and  the entries  relating thereto in columns (2) and (3) shall be omitted.

6.  INCOME SUPPORT LEVY ACT 2013.? There is hereby imposed an Income Support Levy for the purposes herein after appearing;

AN ACT

to provide for charge and collection of Income Support Levy

WHEREAS  it  is  desirable  to  provide  financial  assistance  and  other  social protection and safety net measures to economically distressed persons and families; AND WHEREAS under the principles of policy as given in the Constitution of the Islamic Republic of Pakistan, the State is obliged to promote social and economic well-being of the people and to provide basic necessities of life; AND WHEREAS  it  is expedient  to provide for financial resources for running an income support fund for the economically distressed persons and their families through a Levy to be called Income Support Levy;

It is hereby enacted as follows:-

1.  Short title, extent and commencement.-  (1)  This  Act  may  be called the Income Support Levy Act, 2013.

(2)  It extends to the whole of Pakistan.

(3)  It shall come into force at once.

2.  Definitions.- (1)  In this Act, unless the context otherwise requires –

(a)  “Levy” means  the  Income Support Levy  leviable or payable under this Act;

(b)  “net moveable wealth” means  the amount by which  the aggregate value of the moveable assets belonging to a person as declared in the wealth statement  for  the  relevant  tax year,  is  in excess of  the aggregate  value  of  all  the  liabilities  owed  by  that  person  on  the closing date of the tax year.

Explanation.- For the purpose of this clause,- (i)  where  liability  claimed  relates wholly  and  exclusively  to  an immovable asset,  it  shall not be  claimed and allowed while computing  the  net  moveable  wealth.  However,  where  the liability claimed relates wholly and exclusively to a moveable asset, it shall be claimed and allowed as a straight deduction while computing net moveable wealth; and (ii)  where  the gross wealth of a person, declared  in  the wealth statement  includes  both moveable  and  immoveable  assets and  the nature of assets  to which  the  liability  relates  is not determinable, the liability to be allowed while determining the net  moveable  wealth  shall  be  calculated  by  the  following formula:-

(A / B) x C

Where –

A   is the gross value of moveable assets;

B  is  the  gross  value  of  both  moveable  and

immoveable assets; and 

C  is the gross value of debts owed;

(c)  “Officer of Inland Revenue” means the Officer of Inland Revenue as

defined under clause (38A) of section 2 of the Ordinance;

(d)  “Ordinance”  means  the  Income  Tax  Ordinance,  2001  (XLIX  of 2001);

(e)  “person” means an individual;

(f)  “prescribed” means prescribed by the rules made under this Act; 

(g)  “tax year” means the tax year as defined in clause (68) of section 2 of the Ordinance; and  

(h)  “wealth  statement” means  a wealth  statement  required  to  be  filed under section 116 of the Income Tax Ordinance, 2001.

(2)  All other words and  impressions used, but not defined herein, shall have the same meaning as is assigned to them under the Ordinance. 

3.  Charge  of  Levy.-  Subject  to  the  provisions  contained  in  this  Act,  there shall  be  charged  for  every  tax  year  commencing  on  and  from  tax  year 2013 a Levy, in respect of value of net moveable assets held by a person on the last date of the tax year at the rate specified in section 9 and in the manner specified hereunder.

4.  Time and manner of payment of Levy.-  A  person  who  is  liable  to pay  the  Levy  under  this  Act  shall  pay  the  Levy  along  with  wealth statement.

5.  Assessment of Levy.-  The  Officer  of  Inland  Revenue  shall,  by  an order  in  writing,  determine  the  Levy  payable,  and  shall  serve  upon  the person a notice of demand specifying the sum payable and the time within which  it  shall  be  paid  and  thereupon  such  sum  shall  be  paid  to  such account  and  in  such  manner  as  may  be  prescribed,  within  the  time specified in the notice.

6.  Default surcharge.-  Without  prejudice  to  any  liability  under  any other law  for the  time being  in force, where a person fails  to pay Levy as provided  under  section  4  or  the  levy  so  paid  is  less  than  the  amount payable, he shall be  liable  to pay default surcharge at  the  rate of sixteen per cent per annum on  the amount not paid or  the amount by which  the Levy  paid  falls  short  of  the  amount  payable,  calculated  from  the  date  it was payable to the date it is paid or the date of an order under section 5, whichever is earlier.

7.  Recovery of Levy.-  The provisions of  the Ordinance shall, so  far as may be practicable, apply to the collection of Levy under this Act as they apply to the collection of tax under the Ordinance.

8.  Appeals, revisions and rectifications.-  The  provisions  of  the Ordinance shall, so far as may be practicable, apply to an appeal against, or  revision or  rectification of, an order under  this Act as  they apply  to an appeal, revision or rectification under the Ordinance.

9.  Rate of Levy.-  The rate of levy payable under this Act shall be 0.5% of the net moveable wealth exceeding one million rupees. 

10.  Power to make rules.-  The  Federal  Board  of  Revenue  may,  by notification in the official Gazette, make rules for carrying out the purposes of this Act.

 

 

 

 DECLARATION UNDER THE PROVISONAL COLLECTION OF TAXES

ACT, 1931 (XVI OF 1931)

 

 The provisions of sub-clause (10) of clause 2, sub-clause (2), sub-clause (3), sub-clause (7), sub-clause (13) and sub-clause (14) of clause 3 and  sub-clause (6), sub-clause  (8)(a)(ii),  sub-clause  (8)(a)(iii),  sub-clause  (8)(a)(iv),  sub-clause  (8)(b)  and sub-clause (9) of clause 5 of this Bill shall have effect, for the purpose of this declaration and for the purposes of  the provisions of  the Provisional Collection of Taxes Act, 1931 (XVI of 1931), as  if  they were provisions  for  imposition of sales  tax or duties of federal excise or duties of customs. It is hereby declared accordingly in terms of section 3 of the said Act that it is expedient in the public interest that the aforesaid provisions shall have effect on the 13th June, 2013. 

 

STATEMENT OF OBJECTS AND REASONS

     The  purpose  of  this  Bill  is  to  make  financial  provisions  for  the  year beginning on the first day of July, 2013. Various provisions have been explained in the Notes on Clauses. 

(MUHAMMAD ISHAQ DAR)

Minister for Finance and Revenue