Pakistan: Salient features of Finance Supplementary (Second Amendment) Bill of 2019
23-01-2019: Islamabad, Government of Pakistan Led by Mr. Imran Khan of PTI today tabled a Finance Bill namely Finance Supplementary (Second Amendment) Bill of 2019.(The Finance Bill)
Following are the main features of the said Finance Bill;
- Tax on income of Banks generated from loans to small businesses /SMEs, agriculture sector and low-income housing to be reduced from 39% at present to 20%.
- Introduction of interest-free revolving credit of Rs5 billion (qarz-i-husna) for house building.
- Withholding tax on bank transactions waived off for tax filers.
- Ban on purchase of vehicles for non-filers lifted for new locally manufactured cars up till 1300CC capacity, but higher taxes will apply.
- Small businesses exempted from submitting withholding tax returns every month; will do so only twice every year.
- Rs. 20,000 fixed tax on marriage halls constructed on 1 kanal or less reduced to Rs. 5,000.
- Pilot scheme to be introduced in Islamabad to facilitate traders in filing and paying taxes.
- Duty on newsprint abolished completely.
- Investment in local manufacturing of Alternate energy equipment including solar panels and wind turbines to be exempt from duties and taxation for five years.
- Reduction and abolishment (in some cases) of duties on raw materials to support export industries.
- Super tax on non-banking companies to be abolished from July 1, 2019.
- Continuation of 1pc per annum reduction in corporate income tax. Currently Corporate Tax is 29%.
- Capital loss carry-over to be allowed for 3 years (stock trading).
- 02 per cent withholding tax on trading to be abolished.
- Import duties on cars with engine capacity of 1800CC and above to be increased.
- Taxes and duties on mobile phones rationalised: taxes on budget sets to be reduced, high-end sets to become more expensive.
- Machinery for greenfield projects (including renewables) to be exempt of customs duty, sales tax and income tax (for five years)
- Tax refunds to be worked out; promissory notes to be issued by mid-February.
- Gas Infrastructure Development Cess to be removed from fertiliser production.
- Duty on diesel engines for agricultural applications to be reduced to 5pc from current 17pc.
- Tax on income from loans to SME sector to be reduced to 20pc.
- Agricultural tax will be dropped to 20 per cent.
- Rs5 billion revolving fund (Qarz-e-hasna) will be introduced.
- Non-fillers will be able to purchase small and mid-size cars up to 1300CC, but the tax would be increased.
- Withholding tax for filers on banking transactions will be eliminated to encourage the culture of paying taxes.
- Rs20,000 fixed tax on marriage halls reduced to Rs5,000.
- Import on duty for newsprint will be eliminated.
- Pilot scheme to be introduced in Islamabad to facilitate traders in filing and paying taxes.
- Super tax on non banking companies to be abolished from July 1.
- Small businessmen will be submitting withholding tax returns only twice every year, they are exempted from submitting withholding tax returns every month.