Business

Govt may slap flood levy ranging from 1-3% on all imports

Published

2 years ago

Farwa

Govt also considering windfall tax on lofty profits in banking sector.
Drops proposal to jack up CVT on luxury, imported vehicles.
Govt to grant exemption on import of essential food items.

ISLAMABAD: The government may impose a flood levy ranging from 1-3% on all imports through a presidential ordinance keeping in consideration a waiver to basic food items and raw medicine material imports, The News reported Wednesday.

The government is also considering a windfall tax on lofty profits in the banking sector. The profit earned by the banks in the form of alleged currency manipulation is being bifurcated by the taxation authorities with normal income to impose the additional tax.

Another proposal to jack up the capital value tax (CVT) on luxury and imported vehicles has been dropped by the government.

The International Monetary Fund (IMF) also opposed the amnesty scheme for the regularisation of vehicles registered in Federally Administered Tribal Areas (FATA) and Provincially Administered Tribal Areas (PATA) since 2018, when these districts merged into Khyber Pakhtunkhwa.

Official sources confirmed to The News that the State Bank of Pakistan (SBP) had reported lofty profits of Rs100 billion by commercial banks in the first three quarters (Jan–Sept) of the current calendar year 2022, compared to Rs37 billion in the same period of the last year 2021.

The SBP data showed that the banks had earned Rs63 billion in extra profits. So a windfall tax is under consideration to get the due share for the national exchequer.

Citing the example of energy companies that earned lofty profits in the aftermath of the Russia and Ukraine war, the Western world slapped a windfall tax and the same happened in the case of the banking sector in Pakistan.

“We are also considering the windfall tax cautiously,” said one official, who added that the litigation on the super tax in the superior judiciary was underway, so the government wanted to move ahead in a manner that it might not be struck down by the courts.

“There is also a need to ascertain the exact level of windfall profits after excluding the normal increase in profits of banks,” said the official, who added that it would be hard to declare the whole extra profit of Rs63 billion as part of the windfall profit of banks.

There is a need to calculate the windfall profits of banks carefully, so it is assumed that the commercial banks had earned an extra profit in the range of Rs50 billion, and this amount should be taxed as windfall tax.

There are different rates under consideration, and the government will finalise it if this proposal gets approval from all relevant forums in the coming few days.

The government is likely to issue an ordinance to that effect to appease the IMF and pave the way for a staff-level agreement to be reached within the next month.

Finance Minister Ishaq Dar is expected to meet the IMF delegation on the sidelines of a donors’ conference, which will be held in Geneva on January 9, 2023, to rally financial support for the flood-affected areas in Pakistan.

On the proposed flood levy, the sources said that the government would grant an exemption on the import of onions, tomatoes and other essential food items, as well as medicines and their raw materials, but a levy in the range of 1-3% will be slapped on all other imported items.

This revenue measure will fetch Rs60 billion in the remaining six months of the current fiscal year.

The Federal Board of Revenue of Pakistan has been currently busy identifying those sectors that had earned lofty profits in the last fiscal year like banking and beverage.

It is yet to be seen how the government decides to take action to fetch the additional tax and non-tax revenues to satisfy the IMF and revive the stalled programme.

Business

An investigation was “launched” into PTA’s inability to get Rs. 78 billion back from Telcos

Published

22 hours ago

Farwa

The PTA has reportedly been instructed to reply to NAB by July 29. According to the enquiry, the national exchequer has suffered losses as a result of the delay in collecting dues.

The PTA has been asked to provide NAB with information about any pertinent records, court proceedings, and overdue bills. The NAB Karachi has summoned the PTA officials to appear with all pertinent documentation.

All of the principle sum has to be paid by the LDI firms, according to sources. But due to judicial stay orders, the collection of dues has been impeded.

These sources further state that a steering group has been established by the Ministry of IT to supervise the issue of dues recovery.

In a previous event, the tariffs levied on importing cell phones from outside were clarified by the Pakistan Telecommunication Authority (PTA).

Contrary to what some internet reports claim, PTA clarified in response to recent news regarding the tariffs on mobile phone imports that there hasn’t been a formal decision to remove these levies in Pakistan.

the PTA.Pakistanis living abroad will be the only ones free from these levies, according to the PTA. A SIM card can be inserted and the phone restarted to temporarily register a device for non-PTA mobile subscribers.

Business

Weekly inflation in Pakistan increased by 0.17 percent.

Published

22 hours ago

Farwa

The SPI for the week under review in the aforementioned group was reported at 321.95 points, as opposed to 321.40 points during the previous week, according to the PBS statistics.

The SPI for the combined consumption group saw a 20.09 percent increase in the week under review compared to the same week the previous year.

The weekly SPI includes 51 necessary items for every spending group and 17 urban areas, with a base year of 2015–16 = 100.

The SPI for the lowest consumption category, which is up to Rs 17,732, grew by 0.08 percent from 311.97 points to 312.22 points this past week.

0.18 percent,The index of consumption for the lowest consumption groups, which are Rs 17,732-22,888, Rs 22,889-29,517, Rs 29,518-44,175 and above Rs 44,175; increased by 0.13 percent, 0.15 percent, 0.18 and 0.19 percent, respectively.

Nineteen (37.25%) of the fifty-one commodities had price increases over the week, eight (15.69%) had price decreases, and twenty-four (47.06%) had unchanged pricing.

On a weekly basis, the following commodities saw significant price decreases: tomatoes (9.19%), onions (2.14%), LPG (1.04%), bananas (0.53%), wheat flour (0.35%), potatoes (0.17%), pulse masoor (0.16%), and bread (0.05%).

Chicken (4.80%), garlic (2.01%), pulse gramme (1.87%), eggs (1.71%), beef (0.93%), gur (0.89%), pulse moong (0.84%), fresh milk (0.45%), firewood (0.23%), and cigarettes (0.12%) were among the items whose average prices increased significantly week over week.

The commodities that saw a year-over-year decline were: wheat flour (31.75%); cooking oil (13.44%); vegetable ghee 2.5 kg (10.42%); vegetable ghee 1 kg (9.85%); mustard oil (8.33%); eggs (5.82%); rice basmati broken (4.15%); and tea package (2.52%).

Gas prices for Q1 (570.00%), onions (96.01%), pulse gramme (40.39%), powered milk (39.11%), garlic (34.61%), pulse moong (29.77%), men’s sandals (25.01%), beef (23.52%), salt powder (23.28%), pulse mash (22.50%), and energy saver (17.96%) were among the commodities whose average prices increased year over year.

Business

The price of gold has drastically dropped in Pakistan.

Published

2 days ago

Farwa

As per the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the cost of 24-karat gold per tola decreased by Rs 2,300, standing at Rs 250,500.

A kilogramme of 24-karat gold costing Rs1,972 less at the local market, making it worth Rs2114,763. Ten grammes of 22-karat gold had a price decrease to Rs196,866 as well.

After losing a significant $43 during the day, the rate per ounce of gold on the international market also decreased. It currently stands at $2,370.

On Thursday, the price of 24-karat silver also experienced a decline, falling by Rs60 to settle at Rs2,860 petal.