MH Insights

Federal Board of Revenue (the Board) issued SRO 03(I)/2021 on 04 January 2021 for amending Sub Chapter VIII-A in order to facilitate the international transshipments. The draft amendments were previously notified vide SRO 685 (I)/2021 dated 5 August 2020 which now have been finalized after some modifications. Following is the snapshot of the law: Snapshot Reference No. SRO 03 (I)/202 1 Description Transshipment of imported cargo from gateway port to foreign port Date of Issuance 04 January 202 1 Amendment Customs Rules , 200 1 Objective To amend rules dealing with the transshipment of imported cargo from gateway port to foreign port Effective date With immediate effect Explanation Notification introduced the amendments in following four rules: 1.     510A. Transshipment of imported cargo from gateway pot to a foreign por...

Federal Board of Revenue (the Board) issued SRO 04(I)/2021 on 04 January 2021 in order to make a correction in clause d of sub-rule 6 of rule 554 ( Minimum conditions for registration under sections 155C and 155D of the Act) by substituting the word “security” in place of word “bank”. Following is the snapshot of the law: Snapshot Reference No. SRO 04 (I)/202 1 Description Bank guarantee encashable for breach of rules Date of Issuance 04 January 202 1 Amendment Customs Rules , 200 1 Objective To correct Rule 554. Effective date With immediate effect

Federal Board of Revenue (the Board) issued SRO 06(I)/2021 on 04 January 2021 in order to insert a proviso under sub-rule 8 of rule 300 (grant of DTRE approval) of Customs Rules, 2001. The Board has already introduced the draft amendment through SRO 1299 (I)/2020 dated 01 December 2020. Following is the snapshot of the law: Snapshot Reference No. SRO 06 (I)/202 1 Description Amendment in Customs Rules, 2001 Date of Issuance 04 January 202 1 Amendment Customs Rules , 200 1 Objective To add a proviso for automatic selection and processing of applications, considering applicants profile, for grant of approval for Duty and Tax Remission for Exports (DTRE). Effective date With immediate effect The notification further explains that such applications shall be subject to post approval verification by the respective Collectorate.

Federal Board of Revenue (the Board) in a circular dated 13 January 2021 has asked stakeholders to submit income tax proposals for upcoming finance bill 2021-22 with special focus on the following areas: Broadening of tax base for a wider participation in revenue generation efforts; Taxation of real income on progressive basis; Phasing out of tax concessions and exemptions; Removal of tax distortions  and anomalies; and Facilitation of taxpayers and ease of doing business. Promoting equity in taxation by introducing measures where incidence of tax is higher on affluent classes. The proposals should reach the Board in the prescribed format by 15 February. The Circular was distributed among various stakeholders including all chambers of commerce, industrialist, national accounting bodies and tax forums. For further details, please click here .

Introduction Federal Board of Revenue (FRB) issued a Statutory Regulatory Order ( SRO ) 12 61 ( I ) 2020 on 2 6 November 2020 for a draft amendment in Income Tax Rules, 2002. The SRO proposes to introduce simplified income tax return form along with wealth statement for individuals and association of persons. Snapshot Reference No. SRO 1261 (I)/2020 Description Simplified return of income for manufacturer having turnover less than Rs. 50 million Date of Issuance 2 6 November 2020 Amendment Income Tax Rules, 2002 Objective To simplify return of income tax and accompanying wealth tax statement for manufacturers having turnover upto Rs. 50 million Effective date It is the draft published by FBR to seek suggestions from the affected persons within seven days. However, final amendment will be applicable in tax year 2020.   For furt...

  After years of allowing multiple extensions in the dates of filing the income tax return due to errors in online form, Federal Board of Revenue (FBR) has finally decided to stop that ritual. In routine, FBR finalizes and uploads income tax return form after the close of a financial year to which the Return relates. As soon as the return goes online, stakeholders from business, industry, bars and accounting profession start identifying errors in return form and ask for extension in the date of deadline for filing the return. So, FBR has issued rule for time limit for notifying income tax return in order to avoid giving repeated extensions in the return filing date. Following is the brief introduction of the law: Snapshot Reference No. SRO 1185 (I)/2020 Description Rule 34A. Time limit for notifying income tax return form Date of Issuance 06 November 2020 Amendment Income Tax Rules, 2002 ...

  Digitization is one of the most disruptive force which all kind of organizations are facing. Today, business organizations are trying to adopt digital technologies in order to remain sustainable and relevant. Digitization has significantly changed the way the businesses are done. It has modified the sale and purchase of goods, affected the engagement between sellers and buyers, enhanced the competition, removed the barriers to entry and, at the same time, created new barriers to entry. People in sustainable organizations work on lot of data to gain sufficient business insight in order to produce goods and services which are valued. Accountants are at the helms of affairs when it comes to data processing and analysis. Yet, most of the accountants hate coding and rely on their good old friend  –   Microsoft Excel. Since the amount of data, that is required to be analysed, is so big, use of Excel in old fashioned way may slow analysis and, resultantly , decisions. It is ti...

Sustainability is one of the most talked about buzz word in business. Still there are no hard laws for reporting sustainable business practices in Pakistan due to which it has become only a greenwashing exercise. Greenwashing is a process under which companies create a false impression about their contribution towards environment and sustainability. This is in itself is an unsustainable way for people, profit and planet. Securities and Exchange Commission of Pakistan ("SECP"), being the sole regulator of corporate sector in Pakistan, issued Corporate and Social Responsibility General Order through SRO No. 983(I)/2009 on 16 November 2009. This Order requires to disclose sustainability activities taken by a Company in its directors' report in descriptive and monetary terms. All the 545 Public Interest Companies, currently listed on the Pakistan Stock Exchange, report CSR activities in their directors' report in accordance with the provisions of above mentioned General ...

On 22 July 2020, State Bank of Pakistan ("SBP") communicated through its IH&SMEFD circular letter No. 23 of 2020 some amendments in its earlier instructions regarding its Green Banking Initiative under which it provides refinancing facilities to Banks and Financial Institutions for Renewable Energy ("RE") projects at subsidize rates. In 2019, SBP implemented a financing scheme for RE projects after the expiry of an earlier scheme that was initiated in 2016. The scheme has classified RE projects in three categories: Category I: Projects of 1 to 50 MW for prospective sponsors;    Category II: Projects of  up to 1 MW for prospective sponsors; Category III: Projects of 1 MW for suppliers / vendors of RE equipment; On Wednesday, SBP announced amendments for category III of the scheme after receiving the positive response. In the original scheme, Banks and Financial Institutions could provide financing only to vendors / suppliers certified by Alternative Energy Board...

State Bank of Pakistan (SBP) in its circular Export Policy Order (EPD) No. 16 of 2020 has extended the date for filing the claim of refund of Duty Drawback of Taxes (DDT). SBP has done this on the advice of  Ministry of Commerce . The deadline of submission date has been extended from 31 May 2020 to 31 August 2020 and 15 October 2020 for normal and additional DDT claims respectively both for textile and non-textile products. Pakistan had been facing persistent current account deficit and balance of payment crisis. Therefore, Government of Pakistan announces to provide cash subsidiary, as incentive, to export oriented sectors in order to enhance the exports of the country. SBP issued two separate EPD for textile and non-textile sectors in 2018.  SBP through circular EPD No. 21 of 2018 dated 26 November 2018 issued DDT Order 2018-21 for textile sector. It allows DDT on predefined rates on the export shipments made from 01 July 2018 to 30 June 2021 of specific products mentione...