Latest news with #RashidMahmood
Business Recorder
21-06-2025
- Business
- Business Recorder
Spending via online apps: Pakistanis spent over Rs317bn in FY25, NA panel told
ISLAMABAD: The Federal Board of Revenue (FBR) Saturday informed the National Assembly Standing Committee on Finance that Pakistanis spent over Rs 317 billion on various online apps from tech giants including Meta, Apple, Netflix, etc, during 2024-25. According to a presentation ('Digital Presence' Proceeds Levy Act, 2025) given by FBR Chairman Rashid Mahmood to the committee on Saturday, the value of such transactions stood at above Rs 317 billion in 2024-25. Total number of transactions stood at 42,684,264 during this period. The federal government has introduced the 'Digital Presence' Proceeds Levy Act, 2025, which imposes a new tax on foreign vendors supplying digitally ordered goods and services to consumers in Pakistan. The tax rate has been proposed at 5 percent of the total amount paid. Mobile apps: SBP issues new guidelines for transaction security 'Foreign vendors providing e-commerce goods of services will be taxed for income tax at 5 percent under the said Act,' the bFBR Chairman said. The payment intermediaries including banks and financial institutions will collect tax on digital payments made to foreign vendors supplying goods or services into Pakistan. The committee considered the proposed amendments to The Digital Presence Proceeds Tax Act, 2025. After detailed deliberations, the committee recommended that the Bill may be passed with minor amendments by the National Assembly. The FBR Chairman informed that the FBR data revealed the spending spree covering a wide array of apps, from social media giants to online shopping websites and streaming services. Leading the charge is Facebook/Meta, with Rs. 12.3 billion in transactions. Data further revealed that Apple/iTunes saw the highest number of transactions (over 5.1 million), totaling nearly Rs 6 billion. The data revealed that the Google followed closely with 2.3 million transactions and a transaction value of Rs 5.94 billion. Subsequently, Ali Express made strong spending of Rs 4.9 billion in over 944,466 transactions. The Temu carried out worth Rs. 1.8 billion transactions whereas number of transactions stood at 376,745 during this period. Netflix witnessed 3.37 million transactions worth Rs. 2.79 billion. 'Other' online platforms had a total combined number of transactions at 28.6 million, totaling a staggering Rs. 281.4 billion. The committee considered the proposed amendments to the Islamabad Capital Territory (Tax on Services) Ordinance, 2001. After detailed deliberations, the Committee recommended that the amendments proposed in the Bill may be passed by the Assembly. The committee examined the proposed amendments to The Income Tax Ordinance, 2001. After detailed deliberations, the committee approved proposed amendments and suggested additional corrections and revisions to several clauses. Members/MNAs Omer Ayub Khan, Zeb Jaffar, Muhammad Usman Awaisi, Muhammad Jawed Hanif Khan, Dr Mirza Ikhtiar Baig, Dr Nafisa Shah, Sharmila Sahiba Faruque Hashaam, Muhammad Mobeen Arif, Usama Ahmed Mela, Shahram Khan, Shahida Begum, Sami ul Hasan Gilani Ali Zahid besides the Minister of Finance and Revenue, Minister of State, Secretary, Finance, Chairman FBR attended the meeting. Copyright Business Recorder, 2025
Business Recorder
02-06-2025
- Business
- Business Recorder
Sindh farmers ask FBR to reduce duty on tractors
ISLAMABAD: Small farmers from Sindh have approached Federal Board of Revenue (FBR) to reduce custom duty on imported tractors from 15 percent to 5 percent under massive tariff rationalisation plan to be implemented in budget (2025-26) to support agriculture sector. Farmers have also proposed FBR Chairman Rashid Mahmood to reduce the existing sales tax rate on locally manufactured and imported tractors from 14 percent to 5 percent, enabling the farmers to purchase tractors. This is not an exemption, but only a reduced rate already applicable of many items including vehicles under Sales Tax Act. The budget proposals of the Sindh Chamber of Agriculture (SCA) Hyderabad to FBR Chairman included rationalisation of tax structure and abolishment of levy of sales tax on tractors to support agriculture sector. Sales tax on tractors, pesticides likely When contacted, sources in the FBR revealed that the proposals are under consideration of the FBR during ongoing budget preparation exercise to facilitate poor farmers of the country. The chamber stated that the approved tariff plan to be implemented in budget (2025-26) covers elimination of Additional Customs Duty (ACD); phasing out of Regulatory Duty (RD); gradual elimination of the Fifth Schedule of the Customs Act and restructuring of the customs tariff. This must cover most essential item i.e. tractor which is not a luxury item like vehicle. Nabi Bux Sathio, Senior Vice President, Sindh Chamber of Agriculture Hyderabad stated: 'We, as representatives of the farming and agricultural community in Sindh, feel compelled to shed light on the significant challenges and hardships faced by our fellow farmers and agriculturists in recent times'. The chamber stated that the agricultural sector plays a pivotal role in Pakistan's economy, contributing 24% to the GDP and employing 37.4% of the workforce. However, the sector is currently grappling with a myriad of complex issues. These include the lack of investment and support, the adverse effects of climate change, and the dwindling availability of water, exacerbating the challenges faced by farmers and agriculturists. Moreover, farmers have been severely impacted by the inability to secure fair prices for their produce. The government's announcement of support prices for wheat and cotton has not translated into actual purchases at the stipulated rates, leaving farmers with no choice but to sell their crops at significantly lower prices. The situation is further compounded by the low prices offered for rice and the potential delay in the sugar cane crushing season, which has added to the woes of the farming community. He urged the FBR to reduce the existing sales tax rate on locally manufactured and imported tractors from 14% to 5% enabling the farmers to purchase tractors, and also reduce the custom duty on imported tractors from 15% to 5% and also for re-conditional tractors. Copyright Business Recorder, 2025
Business Recorder
30-05-2025
- Business
- Business Recorder
Solar panels: Pakistan govt mulling withdrawing ST exemption
ISLAMABAD: Chairman Federal Board of Revenue (FBR) Rashid Mahmood said Thursday that the government is examining a proposal to withdraw sales tax exemption on solar panels in budget (2025-26). FBR Chairman was responding to a query of a member of the Senate Standing Committee on Finance during meeting held at the Parliament House. He stated that the FBR is working on proposals to withdraw all kinds of tax exemption including exemption available on the import of solar panels. Cabinet halts additional tax on solar power users Meanwhile, during another meeting of the National Assembly Standing Committee on Finance, the representatives of Refineries briefed the committee that their input was taxed, but on output, there was no GST, causing problems over the last several years. Without resolving this issue, they would not be able to invest $6 billion. The Chairman FBR, Rashid Mahmood Langrial, said that their business came out of the ambit of the Value Added Tax (VAT) when there was no tax on their output. He said that there were proposals under consideration to impose sales tax on their output or provide them some kind of other permanent solutions. Chairman FBR has also assured the committee that he will inquire into the matter of recovering over Rs 80 million amounts from KababJee restaurant Karachi. Member of committee Mirza Ikhtiar Baig raised the issue before the finance committee chaired by Nafeesa Shah. He informed that FBR has recovered more than Rs 80 million from accounts of this restaurant without giving any chance of hearing in different forums. He has no money to pay salaried and owner of the restaurant has threatened to commit suicide. The business community is pressing me for this harassment by the FBR, Baig added. The FBR Chairman replied that I did not have knowledge of this particular case. I will update the committee after inquiring about the matter from the relevant field office of FBR. The committee considered 'The Income Tax (Second Amendment) Bill, 2025'. The Committee expressed concern over the second proviso of the newly inserted clause (3A). The Secretary Revenue assured the Committee that the concerns of the Hon. Members would be addressed and that the words 'and shall cease to have effect after tax year 2025' would be deleted. Upon the assurance given by the Secretary Revenue, the Committee recommended that the Bill, as amended, may be passed by the Assembly. The Committee considered Starred Question No. 38, moved by Aliya Kamran, MNA, regarding the imposition of Section 99D of the Income Tax Ordinance, 2001, and Starred Question No. 40, moved by Sharmila Sahiba Faruqui Hashaam, MNA, regarding the recent policy shift prioritizing digital currencies, without adequately addressing their regulatory deficiencies. After a detailed discussion the Committee decided to defer both agenda items for discussion in the next meeting of the Committee. The report on the 'non-implementation of minimum wages, as announced by the Federal Government in its departments', a matter raised by Syed Rafiullah, MNA and referred by the Honourable Speaker, was also deferred due to the absence of the mover. Copyright Business Recorder, 2025
Business Recorder
30-05-2025
- Business
- Business Recorder
FBR links cut in FED on juices with submission of post-dated cheques
ISLAMABAD: Federal Board of Revenue (FBR) Chairman Rashid Mahmood has linked reduction of federal excise duty (FED) on juices from 20 to 15 percent in budget (2025-26) with submission of post-dated cheques of the FED to be collected in the next fiscal year. During the meeting of National Assembly Standing Committee of Finance held here on Thursday, juice industry pleaded case for reduction in the FED on juices in the coming budget. The FBR chairman, Thursday, conveyed to the juice industry to deposit post-dated cheques of the FED in case FBR proposed reduction of FED on juices from 20 to 15 percent in budget (2025-26). 'High tax on packaged juices stifles growth, hurts economy' The industry was surprised to hear such a strange proposal from the tax authorities of submission of the post-dated cheques. The industry representatives stated that how post-dated cheques could be submitted of the FED to be collected on sales to be taken place during the next fiscal year. The FBR chairman responded that it is the claim of the industry that the reduction in FED would increase volumes and ultimately raise tax collection during next fiscal year. The industry should submit post-dated cheques to substantiate its claims. The FBR chairman added that 'we have to impose taxes in cases where we will give relief to the taxpayers to overcome the revenue shortfall. In case of relief to any sector/industry, there should be some alternate proposal to generate same amount of revenue.' Fruit Juices Council's representative Aatika Mir informed the committee that 20 per cent FED (on top of existing 18 per cent GST) imposed on the formal packaged juice industry since 2023, continues to stall the juice industry's growth. Decreasing sales' volumes of 45 per cent have also meant that in 2024-25, the government's revenue projections fell short of expectations. The Fruit Juice Council, a body representing the formal juice industry, is asking for a reduction in the FED imposed on the juice industry. In line with local regulations, fruit drinks have minimum five per cent fruit content, nectars have 25 per cent—50 per cent fruit content, and pure juices have 100 per cent fruit content. Fruit-based juices are a healthier option and are promoted as such by Food Authorities since they contain the goodness of fruits. Punjab and Sindh Food Authorities allow the sale of fruit-based juices in educational institutions while restricting sales of any other beverages. Industry crash after 20 per cent FED imposition (in addition to 18 per cent GST), she pleaded. Following a strong growth trajectory, the sales were projected to grow to more than Rs71billion in 2022-23. However, with the imposition of 20 per cent FED on juices (in addition to 18 per cent GST) since the Annual Budget 2023-24, industry sales have plunged by 45 per cent. Sales over the last year have fallen to around Rs42 billion. Aatika stated that the decline in sales has led to the industry being unable to utilise its installed production capacity, with no new investments in the last three years. This shrinking business size has also negatively impacted fruit farmers and pulp processors since the fruit procurement volumes have dropped to below 2017 procurement volumes; only 20,233 tons of mangoes were purchased last year vs 31,000 tons purchased in 2017-18. In addition, the imposition of 20 per cent FED (in addition to 18 per cent GST) is impacting affordability of the products produced by documented players. This means consumers are effectively paying around 42 per cent of the price as taxes on a pack of juice. This has resulted in a large proportion of consumers shifting to low-priced, low-quality and possibly unsafe alternatives offered by the undocumented sector, which is more than 25 per cent of the industry size. The formal packaged juice industry also shows great potential for increasing exports. Currently, packaged juices are exported to more than 30 countries across the world, with the potential to increase them. However, if the industry fails to get back on the growth trajectory, exports will also end up suffering. The Fruit Juice Council has requested the government to reduce the FED rate on the formal juice industry to 15 per cent. Copyright Business Recorder, 2025
Business Recorder
30-05-2025
- Business
- Business Recorder
Solar panels: Govt mulling withdrawing ST exemption
ISLAMABAD: Chairman Federal Board of Revenue (FBR) Rashid Mahmood said Thursday that the government is examining a proposal to withdraw sales tax exemption on solar panels in budget (2025-26). FBR Chairman was responding to a query of a member of the Senate Standing Committee on Finance during meeting held at the Parliament House. He stated that the FBR is working on proposals to withdraw all kinds of tax exemption including exemption available on the import of solar panels. Cabinet halts additional tax on solar power users Meanwhile, during another meeting of the National Assembly Standing Committee on Finance, the representatives of Refineries briefed the committee that their input was taxed, but on output, there was no GST, causing problems over the last several years. Without resolving this issue, they would not be able to invest $6 billion. The Chairman FBR, Rashid Mahmood Langrial, said that their business came out of the ambit of the Value Added Tax (VAT) when there was no tax on their output. He said that there were proposals under consideration to impose sales tax on their output or provide them some kind of other permanent solutions. Chairman FBR has also assured the committee that he will inquire into the matter of recovering over Rs 80 million amounts from KababJee restaurant Karachi. Member of committee Mirza Ikhtiar Baig raised the issue before the finance committee chaired by Nafeesa Shah. He informed that FBR has recovered more than Rs 80 million from accounts of this restaurant without giving any chance of hearing in different forums. He has no money to pay salaried and owner of the restaurant has threatened to commit suicide. The business community is pressing me for this harassment by the FBR, Baig added. The FBR Chairman replied that I did not have knowledge of this particular case. I will update the committee after inquiring about the matter from the relevant field office of FBR. The committee considered 'The Income Tax (Second Amendment) Bill, 2025'. The Committee expressed concern over the second proviso of the newly inserted clause (3A). The Secretary Revenue assured the Committee that the concerns of the Hon. Members would be addressed and that the words 'and shall cease to have effect after tax year 2025' would be deleted. Upon the assurance given by the Secretary Revenue, the Committee recommended that the Bill, as amended, may be passed by the Assembly. The Committee considered Starred Question No. 38, moved by Aliya Kamran, MNA, regarding the imposition of Section 99D of the Income Tax Ordinance, 2001, and Starred Question No. 40, moved by Sharmila Sahiba Faruqui Hashaam, MNA, regarding the recent policy shift prioritizing digital currencies, without adequately addressing their regulatory deficiencies. After a detailed discussion the Committee decided to defer both agenda items for discussion in the next meeting of the Committee. The report on the 'non-implementation of minimum wages, as announced by the Federal Government in its departments', a matter raised by Syed Rafiullah, MNA and referred by the Honourable Speaker, was also deferred due to the absence of the mover. Copyright Business Recorder, 2025
