Federal Board of Revenue-News Room

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Federal Board of Revenue (FBR) has allowed exemption from deduction of tax on import of plant and machinery for setting up an industrial undertaking, including hotels.
The exemption has been granted by the FBR through SRO No 1139(1)2008 whereby the board has amended section 148 of the Income Tax Ordinance 2001 to allow tax exemption on import of plant or machinery required to set up an industrial concern or for its installation in an existing industrial undertaking.
According to the notification, FBR has also authorized Income Tax commissioners to grant system-based exemption certificates to importers of goods consisting of plant, machinery, fixtures, fittings or their allied equipments required for the purpose of setting up industrial undertakings.
To apply for the tax exemption, the taxpayers will be required to provide information regarding the industrial undertaking and the intended imports of plant and machinery in a prescribed application form to enable the tax department to check misuse of such exemptions and further monitor use of such imported goods of capital nature.
The step has been taken by the FBR with a view to facilitating the taxpayers who would now be able to save valuable money and contribute towards development of the economy.

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has collected Rs 87.689 billion tax (inclusive of direct and indirect taxes) against the target Rs 78.2 billion for the month of October 2008, says a press release issued here Saturday.

The FBR has so far collected Rs 349.8 billion as against the Rs 329.3 billion target set for the period July-October 2008 in the current fiscal year, showing an increase of over Rs 20 billion. The details/break-down of the figures are attached.

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has transferred six senior officials of the Income Tax Group with immediate effect, says a press release issued here Saturday.

According to the notification 1629-M-IA/2008 dated October 31, 2008, the officers who have been transferred include Sardar Ali Khawaja (BS-19) who has been transferred from the post of secretary (FATE Wing), FBR, Islamabad to the post of additional commissioner, Large Taxpayers Unit, Islamabad. Among others, Mushtaq Hussain Qazi (BS-19) has been transferred from the post of additional commissioner (Enforcement), Regional Tax Office, Karachi to the post of additional director, Directorate of Internal Audit (Income Tax), Karachi; Dr Muhammad Iqbal (BS-19) has been transferred from the post of additional commissioner (legal), Regional Tax Office, Karachi to the post of additional commissioner, Regional Tax Office, Gujranwala; Muhammad Saleem (BS-19) has been transferred from the post of additional director, Addl. Directorate of Internal Audit (Income Tax), Karachi to the post of additional director, Addl. Directorate of Internal Audit (Income Tax), Rawalpindi; Muhammad Saeed Nashir (BS-19) has been transferred from the post of additional commissioner (HQs), Large Taxpayers Unit, Islamabad to the post of additional commissioner, Regional Tax Office, Karachi; and Dr Tauqeer Irtiza (BS-19) has been transferred from the post of secretary (Direct Taxes Wing), FBR, Islamabad to the post of coordinator, Chief Coordinator Computer Wing (Income Tax), Karachi.

According to the notification, the officers drawing special allowance prior to issuance of this notification shall continue to draw the allowance on the new place of posting as well.

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has decided to keep all its field offices open on October 31, 2008 (Friday) till 6:00pm to receive income tax returns.

The decision has been taken because traditionally bulks of the non-corporate returns are filed on the last date of filing of returns.

Similarly all the authorized branches of State Bank of Pakistan and National Bank of Pakistan will remain open till 5:00pm for facilitation of the taxpayers in depositing taxes. Necessary instructions to all concerned have been issued by the FBR and SBP.

 

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has set up 11 tax facilitation centres in the capital to facilitate taxpayers seeking to file their income tax returns before the deadline expires on October 31.

The facilitation centres have been set up by Regional Tax Office Islamabad in line with the FBR's revenue strategy of reforms with special focus on taxpayer facilitation. The centres are spread over the entire capital territory and are situated within the vicinity of business and commercial centres in ten major sectors which include F-6 near Shaheen Homeo, F-7 Goal Market Jinnah Super, F-8 near Mazeban Restaurant, F-10 near Saeed Jewellers Main Double Road, G-6 near National Bank, Melody Market and also one at Aabpara, G-8 Markaz at Old Income Tax Building near Mundail Plaza, G-9 Markaz near Prince Bakers, G-10 Markaz near AAA Plaza, G-11 Main Markaz, I-9/3 Regional Tax Office Plot 210, Street 6, and Blue Area near Rajgan Enterprises. Senior IT officials have also been deputed for supplying and receiving IT returns and other similar statements. In case of any inconvenience and facilitation, Yasmin Yousuf, deputy commissioner Income Tax RTO Islamabad, can also be contacted at 051-9257164.
 

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Directorate General of Intelligence and Investigation of the Federal Board of Revenue (FBR) has seized a large number of smuggled vehicles besides impounding a huge quantity of cloth, mobile phone sets and other items, says a press release issued by the FBR on Saturday.

The seizure of the vehicles and goods made since October 8, 2008 has followed a recent drive launched by the Directorate General of Intelligence and Investigation in view of the rampant smuggling of the foreign-origin goods and on receipt of tip-offs.

As per detail, the Directorate General has been able to apprehend 47 vehicles ranging form luxury cars to Land Cruisers in a short span of five working days through monitoring of information collected and controlled management of anti-smuggling and data analysis activity.

In another raid, a consignment of 4123 sets of smuggled mobile phone sets has been seized on the RCD Highway by the officials of Regional Office Karachi. The quantity of mobile phones seized is the highest in recent seizure history by any enforcement agency.

In yet another operation based on discreet information, five containers for export which cleared through PACCs under claim for rebate declared as tea bags, have also been detained. Initial examination has shown that the contents included salt granules. Similarly, mis-declaration in case of two more containers of an imported consignment has led to their detention. The goods cleared through PACCs were declared as Sodium Sulphate whereas actual examination has revealed the contents as TV kits (Qty 9500) & Tin Plates (36MT). Two more containers of the same importer have also been detained on suspicion of mis-declaration and are awaiting examination.

On receipt of another information that a container has cleared through Islamabad Dry Port on short payment of duty and taxes, the HQs office has managed to detain the said container. Initial examination and valuation analysis of the same is underway.

Apart from these, cloth of foreign origin measuring 63,000 meters has been seized by Regional Office Peshawar. Similarly, 21,418 yard of smuggled cloth has been seized by Regional Office Karachi.

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue Chairman Ahmad Waqar has asked sales tax officials to follow a compliance module to ensure enforcement and services to the taxpayers.

He also called for concerted efforts to be made for the compliance on the one hand and facilitation taxpayers on the other hand. "There should be transparent deterrence against wilful defaulters and this would be the sole criterion of judging the performance of sales tax officers," he said in his address to the Collectors' Conference organised here in the capital. The chairman appreciated tax GAP analysis and directed that IT-based automated system shall be made operational in all RTOs/LTUs.

Earlier, Mr. Abdul Wadood Khan, Member (ST&FE) stated that due to concerted efforts and team work, the target of sales tax has not only been surpassed but with collected sales tax and FED, FBR has been able to fill the gap due to comparatively lesser collection on the direct taxes side.

The member urged the field formations to actively pursue ADRC cases. He also advised the collectors to make concerted efforts in pursuing cases in superior courts of law. The member (ST&FE) and member (DT) agreed on mutual sharing of data by both the direct and indirect taxes and field formations. In this regard, a committee of ST and DT officers has been constituted which will integrate information on the inter-tax adjustment, recovery of arrears and statement of refund claims.

It was for the first time that Member (ST&FE) arranged a detailed proposal on tax gap analysis. For this purpose, Shafqat Mahmood, Collector, RTO, Lahore/ CREST gave presentation on tax gap analysis in different countries. He also gave a detailed presentation on sales tax gap in different sectors in Pakistan. Through empirical data, he showed that the quantum of gap is quite serious.

The FBR chairman appreciated the efforts and ordered the system to be deployed in all the RTOs. For this purpose, the board shall design Special Operating Procedure (SOP) specifying the role of each officer conducting scrutiny of the cases where gap is apparently significant. He instructed the CEO, PRAL to make the resources available to the Collector, CREST and make the system operational within 15 days.

The chairman also expressed concern over accumulation of sales tax refunds and different complaints regarding deliberate delay in disposal of refunds. He directed that the bona fide claims be disposed of expeditiously and in a transparent manner.

The chairman also constituted a committee headed by Mr. Nisar Muhammad, Chief (ST-II), FBR and comprising Collector, RTO, Lahore and Collector (Enforcement), Karachi for finding practicable measures to get liquidated the refund claims. This committee will examine the quantum and irritants of pending refunds claims. The specific recommendations shall be given in order to liquidate expeditiously the admissible refund claims and to reject the inadmissible in accordance with the law.

Sikandar Ahmad Rai, Director General (Intelligence and Investigation) gave a number of different proposals for systematic audit enforcement received for plugging the leakages. His proposals were well-received in the conference and would be implemented in the due course of time.

The chairman appreciated the efforts of Member (ST&FE) for making dedicated and concerted efforts for disposal of genuine claims of sales tax. The chairman made it clear that the officers who were reluctant to serve in Board and other support organizations would not be eligible for promotion. He also assured the field formations of support of FBR in addressing their problems and discharge of services to the taxpayers.

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has extended until October 25 the due date for the submission of sales tax and federal excise returns for the tax period September 2008, says an official statement issued here Saturday.

The statement says the extension in the due date has been granted in view of the problems faced by the registered persons. However, the last date for payment of taxes which was set for October 15, 2008 has not been extended.
 

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

The federal government has imposed regulatory duty equivalent to the price differential claims in rupees per litre on the import of high speed diesel and superior kerosene oil to Afghanistan.

According to notification SRO(I)/2008 dated 09/10/2008, the government has stated that regulatory duty equivalent to the price differential claims (PDC), in rupees per litre, of high speed diesel (HSD) and superior kerosene oil (SKO) as notified by the Ministry of Petroleum & Natural Resources, plus 1 per cent of prevalent consumer price to cover for foreign exchange loss, shall be levied on the export of HSD and SKO to Afghanistan as per rates given in the following table:-                                                                  
                                                                        “TABLE "

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) Chairman Ahmad Waqar has called for concerted efforts coupled with innovative steps to broaden the tax base and increase revenue collection.

"It is important that the measures we take to broaden the tax base should be proactive and not reactionary in nature and such measures should be part of an inbuilt mechanism relying on solid data," he said while speaking to senior tax officials who gathered in the capital on Monday to attend the 2nd Director Generals' Conference to review and improve the pace of revenue collection for the second quarter of the current fiscal year.

The conference was attended by all director generals of the three Large Taxpayers Units (LTUs) and 13 Regional Tax Offices (RTOs) located across the country. Member Direct Taxes Irfan Nadeem, Director General Internal Audit Iqbal Muzaffar and other key officials also attended the conference which reviewed various organizational matters, including those concerning submission of tax returns, payment of taxes and tax facilitation.

Ahmad Waqar said the meeting of director generals and senior officials once in a quarter was a good exercise but it could be more productive and result oriented if the discussions and deliberations were focused and a due care was taken by all to follow up faithfully on the decisions taken in previous meetings.

He exhorted tax officials, especially those manning LTUs in big cities like Karachi and Lahore, to show more vigour and dedication in enhancing the pace of revenue collection. He said the officials were also required to improve their image for them to be seen as facilitators and friends of taxpayers besides helping improve the image of the organisation. He also urged officials to provide taxpayers with maximum help and support, especially in matters pertaining to claim of genuine refunds which should be granted without any delay.

However, Waqar cautioned the officials against unscrupulous elements who took an undue advantage of the facilitation provided to them to run away with fake and bogus refunds. He observed that cases involving delay in refunds claims on payment of sales tax had surfaced in considerably in recent times but such cases could be disposed of easily by tax officials by crosschecking payment of income tax, if due, by such taxpayers. "If followed, such an attitude and approach can strengthen the tax integration process which is a major theme of the tax reforms," he added.

The chairman also drew the attention of the officials to the overall micro and macro economic situation with a view for them to studying the nature and scope of impact it could have on the overall revenue generation and tax collection. "Studying the impact of the changing economic scenario on the tax collection should be an ongoing activity for the tax officials to keep themselves abreast of the economic currents and cross current having a direct bearing on the revenue collection," he said.

Earlier the meeting decided not to extend under any circumstances the last date for the filing of income tax returns and discourage the trend as observed in certain RTOs of extending the time for submission of returns on the due date beyond the office hours. The meeting also decided to strengthen the practice of internal tax surveys to broaden the tax base. It further decided to widely publicise the investment tax scheme to increase its acceptance among the public.
 

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Pakistan and Japan Friday exchanged diplomatic notes to ratify a revised and already signed convention on avoidance of double taxation between the two countries.

The ceremony to ratify the revised convention which was signed on January 23, 2008 in Islamabad following in-depth deliberations and negotiations between the two governments was organised at the FBR Headquarters and the two sides were represented by Chihiro Atsumi, Japan’s ambassador extraordinary and plenipotentiary to Pakistan, and Irfan Nadeem, member (direct taxes) Federal Board of Revenue, from Pakistan.

The convention which comes into force on the 30th day after the date for the exchange of diplomatic note, modernizes the regulations of the existing convention signed in 1959 with a view to positively promoting mutual investment between Japan and Pakistan. Based on the international model income tax treaty, the new convention revises the taxation formula for business income and royalties paid in the respective countries and contains extensive revisions of the existing convention for the first time in 49 years.

The main features of the revised convention include tax exemption for government-owned banks and financial institutions as well as exemption on remuneration to students and business apprentices from 360,000 Japanese yen to 1,500,000 Japanese yen. According to the convention, permanent establishment in the case of building site has been agreed at six months; delivery from a warehouse will be considered as PE; dividend in case of holding companies having 50 per cent share for six months will be taxed at 5 per cent; holding company with 25 per cent voting share at 7.5 per cent and all other taxes at 10 per cent in the source country. The convention also calls for royalty at source country to be taxed at 10 per cent while fee for technical services will be taxable at 10 per cent in the source country.

Speaking on the occasion, Irfan Nadeem, member direct taxes FBR, said the convention would provide safeguards against double taxation on the income of the residents from the two countries besides promoting economic cooperation, investment and bilateral relations between the member countries. He said the convention would also provide adequate certainty in respect of taxation rules applicable to cross-border business transactions, dividends, interests, royalties and fee for technical services. Taxpayers of both countries would also get relief from double taxation increasing as a consequence of expanded trade between the two nations.

Ambassador Atsumi said the new convention was a significant step in facilitating competitiveness of the Japanese and Pakistani companies and incorporating the bilateral taxation relations between the two countries into a modern tax convention framework. He said the updated convention marked a significant step as viewed in the light of Pakistan’s status as a gateway to Central Asia and the Middle East
 

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has strongly denied the contents of an editorial published in a business daily, claiming the existence of "a unique tax scam" involving tax officials as reported by the newspaper.

Describing the news comment as "completely misleading and unfortunate", the FBR in an official statement clarifies that the editorial as published in the Karachi-based business daily appears to be a sequel to a news item that appeared in the same daily on September 22, 2008 and claimed to have unearthed a self-operated racket allegedly involved in the refund of sales tax inputs on exports.

The FBR clarifies that the matter is already being probed under instruction from the higher ups. The inquiry is being conducted from various angles, including some of those suggested in the news report and the subsequent editorial. Preliminary investigations have revealed that no fake CNICs, sales tax registrations or bank accounts have been used in the refunds claims as claimed in the news item and the editorial. Registeration and accounts have been found in the name of the exporting firms and the genuineness of export documents has also been found established after due verification from the concerned export stations. Similarly, it is also untrue to claim that the staff of sales tax collectorate is any way involved in assisting any exporters in the preparation of their refund claims beyond what could be legally permitted.

The FBR statement also terms as absolutely incorrect the observation made in the news comment that the matter is being hushed up. On the contrary, the FBR immediately ordered an inquiry to investigate the matter in the right earnest. The news items seems to be based on a complaint received from some quarters, reflecting certain motives and lack of a prior scrutiny of the facts and thus creating an impression as if some scam has actually taken place in the sales tax refund. FBR has always striven to ensure that its field formations work strictly in the manner as laid down in the sales tax laws and rules coupled with instructions issued from time to time to facilitate and boost the export sector of the economy.

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has released provisional revenue collection figures for the first quarter of the current financial year (July-September 2008-09), showing a marked increase in the ratio and volume of revenue collection.

The figures as released by the FBR are hereby enclosed/attached herewith for information.

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Federal Board of Revenue (FBR) has extended the last date for filing of income tax returns up to October 31 to facilitate the taxpayers.

The one-month extension has been granted following representations received by the FBR from various chambers of commerce & industry, tax bar associations, trade bodies, advocates/income tax practitioners and taxpayers seeking extension of time for filing their IT returns due to constraints faced because of the holy month of Ramazan, Aitkaf, performance of Umrah and the temporary disruption suffered by the e-filing process. The extension would help individuals, associations of persons and the corporate sector to file their returns with convenience and ease.

Meanwhile, the FBR has also extended the due date up to October 31, 2008 for availing of ‘Tax Arrears Settlement Scheme 2008’ (TASIS) introduced earlier vide Circular No.4 of 2008. Under the scheme, individuals, associations of persons and companies against whom tax arrears including additional tax and penalties are outstanding, can settle their outstanding amount of income tax on payment of principal amount only. No additional tax, penalty or fine would be levied in cases where returns are filed in the extended periods.

In another decision, the FBR has also extended up to October 10, 2008 the due date for submission of sales tax and federal excise return and special return for production and supplies, for the tax period August, 2008, and annual sales tax return for the period 2007-08. The board, however, made it clear the payment of taxes for August 2008 had to be made by September 20 as already announced and no further extension would be given to those yet to deposit their taxes.

 

-Sd-
(Hamid Raza Wattoo)
Secretary PR
051-9208407/0346-5023333

Keeping in view the shut down of FBR’s e-portal for six days due to bomb blast in Marriott Hotel and because of approaching Eid holidays, the Federal Board of Revenue is pleased to extend the due date for submission of Sales Tax and Federal Excise Return (STR-7) and Special Return for Production and Supplies, for the tax period August, 2008, and Annual Sales Tax Return for the period 2007-08, up to 10th October, 2008.

The last date for payment of due taxes for August 2008 shall remain unchanged at 20th September, 2008, as already extended vide Sales Tax Circular no. 09/2008 dated 15.09.2008.
 

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

Federal Board of Revenue (FBR) has set up 10 tax facilitation centres in the capital to facilitate taxpayers seeking to file their income tax returns.

The facilitation centres have been set up by Regional Tax Office Islamabad in line with the FBR’s revenue strategy of reforms with special focus on taxpayer facilitation. The centres are spread over the entire capital territory and are situated within the vicinity of business and commercial centres in ten major sectors which include F-6 near Shaheen Homeo, F-7 near Book Fair Jinnah Super, F-8 near Dainty’s Restaurant, F-10 near Saeed Jewellers Main Double Road, G-6 near National Bank, Melody Market, G-8 Markaz near Mundail Plaza, G-9 Markaz near Bus Stand, G-10 near Saon and Bella Road Junction, I-9/3 Regional Tax Office Plot 210, Street 6, and Blue Area near Rajgan Enterprises. Senior IT officials have also been deputed for supplying and receiving IT returns and other similar statements. In case of any inconvenience and facilitation, Yasmin Yousuf, deputy commissioner Income Tax RTO Islamabad, can also be contacted at 051-9257164.

Federal Board of Revenue (FBR) has exempted the Asian Development Bank (ADB) from payment of all taxes, including payment and collection of withholding taxes, says an official statement issued here Saturday.

It says the exemption was already being enjoyed by the ADB under a proviso to section 54 of the Income Tax Ordinance, 2001. However, the proviso was withdrawn following an amendment made through Finance Act, 2008, leaving no cushion or protection to the ADB income from levy of taxes w.e.f. tax year, 2009 and onwards.

The ADP however took up the matter with the Ministry of Finance, requesting for continuation of exemption to the bank as allowed earlier on under Article 56 of the Asian Development Bank Ordinance, 1971, which deals with the implementation of international agreements for establishment and operation of the bank and protects the bank's income from levy of all taxes, including payment and collection of withholding taxes.

The FBR, therefore, has again allowed the exemption to the ADB by amending the Second Schedule to the Income Tax Ordinance, 2001 and adding new clauses vide SRO No. 1012(I)/2008 dated 23.09.2008 whereby the ADB's income has been exempted from all taxes as "under the Asian Development Bank Ordinance, 1971 (IX of 1971)".

-Sd-
(Hamid Raza Wattoo)
Secretary (PR)

Federal Board of Revenue (FBR) has further extended the due date for the submission of sales tax and federal excise return and special sales tax return for production and supplies for the tax period August 2008, up to September 30.

The decision to extend the due date which was previously set for September 25, has been taken due to the technical disruption the FBR's web portal suffered following the Marriott hotel blast. The bomb explosion at the hostel left the board's web portal inoperative for six days, leading to problems for the already registered persons to e-file their sales tax and federal excise returns for the tax period August, 2008.

The board, however, made it clear the payment of taxes for August 2008 had to be made by September 20 as already announced and no further extension would be given to those yet to deposit their taxes. Similarly, the board would not change September 30 being the last date for the submission of annual sales tax return by the corporate sector.

-Sd-
(Hamid Raza Wattoo)
Secretary (PR)

Federal Board of Revenue (FBR) has modified the Income Tax rules to judge taxability and seek more information about the salaried taxpayers.

Under the SRO No. 997(1)/2008 issued by the board, the annual statement of deduction of income tax from salary to be submitted by the employer as specified under Part IX, of the Second Schedule to the income Tax Rules, 2002 has been substituted.

As per new format more information regarding the employee is sought for record of the Tax department in view of the fact that wherever employer's annual statement is filed, employees having no other source of income are not required to file their return of income. The new format also caters to the change in law regarding taxability of salary income for the facility of the employers.

In another SRO No. 998(1)/2008 issued by the FBR, monthly statement of deduction of income tax at source to be filed by the withholding agents in accordance with provisions of section 165(2) as specified in Part X of the Second Schedule to the Income Tax Rules, 2002 has been substituted.

As per new format specified information regarding the nature of payments and taxability of the translations is sought in accordance with change in law and for better monitoring/ analysis of taxes withheld. The changes in the IT rules have been made with a view to facilitating the taxpayers regarding verification/credit of tax withheld.
 

-Sd-
(Hamid Raza Wattoo)
Secretary (PR)

Federal Board of Revenue (FBR) has set up nine tax facilitation centres in the capital to facilitate taxpayers seeking to file their income tax returns before the September 30 deadline.

The facilitation centres have been set up by Regional Tax Office Islamabad in line with the FBR's revenue strategy of reforms with special focus on taxpayer facilitation. The centres are spread over the entire capital territory and are situated within the vicinity of business and commercial centres in nine major sectors which include F-6, F-7, F-8, F-10, G-6, G-8, G-9, G-10 and Blue Area. Senior IT officials have also been deputed for supplying and receiving IT returns and other similar statements.

-Sd-
(Hamid Raza Wattoo)
Secretary (PR)

Federal Board of Revenue (FBR) has clarified a news item published in a section of the press, regarding calculation of duty drawback rates.

In an official statement, the board terms as misleading the news item which says: "The exchange rate of dollar against the rupee has not very much impact for payment of duty drawback on the basis of FOB value. Contrary to this, exporters have to suffer losses for claiming rebate and duty drawback on the basis of export goods quantity calculated in kilograms. The working of duty drawback in kgs on the old exchange rate has negative implications for the export sectors."

The Federal Board of Revenue clarifies that in most of items the duty drawback is allowed on the basis of FOB value whereas the number of items on which duty drawback is allowed on the basis of specific rate is quite small. Therefore, impact of parity rates is insignificant on items where FOB value is the criteria.

For revision of duty drawback rates the criteria is laid down in the Customs Rules. According to relevant rules, such revision should be completed by the 30th January for preceding year, the exercise for revision of the rates is in hand by IOCO and the revised rates would be finalised by the due date.

-Sd-
(Hamid Raza Wattoo)
Secretary (PR)

The Federal Board of Revenue (FBR) has extended the date for payment of sales tax and federal excise duty, including special excise duty, for the tax period August 2008, up to September 20, 2008.
The board has further extended the due date for submission of sales tax and federal excise return for the said tax period up to September 25, 2008. The extension has been granted keeping in view the recent introduction of mandatory electronic filing of sales tax and federal excise returns and to facilitate taxpayers to familiarise themselves with the new system.

-Sd-
(Hamid Raza Wattoo)
Secretary (PR)

The Federal Government has issued a notification SRO 946(I)/2008 dated 04.09.2008 whereby regulatory duty equivalent to the Price Differential Claims (PDC), in Rupees per litre, of High Speed Diesel (HSD) and Superior Kerosene Oil (SKO) as notified by the Ministry of Petroleum & Natural Resources, plus 1% of prevalent consumer price to cover for foreign exchange loss, shall be levied on export of HSD and SKO to Afghanistan as per rates given in the following Table:-

2.   The rates given the table shall remain inforce till an amendment is made by the Ministry of Petroleum and Natural resources on the basis of their calculations.

3.The exports of HSD & SKO made to Afghanistan shall be contingent upon strict adherence to the procedure, terms and conditions laid down in the Export Policy Order.

-Sd-
(Khalid Mahmood)
Secretary (Export Policy)

 Tax Bar Associations and taxpayers have requested for extension in last date for filing of annual withholding tax statement due on 31st August, 2008 on account of their pre-occupation with e-filing of sales tax returns.

The request has been considered by the Federal Board of Revenue and it has been decided to facilitate the taxpayers. Accordingly, the last date for filing of annual withholding tax statements is extended up to 5th September, 2008, with no penal action.

All withholding tax agents are requested to ensure filing of their annual withholding tax statements by the extended date i.e. 5th September, 2008.

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