ISLAMABAD: The authorities have levied a 12.5 percent on income generated by offshore companies on Tuesday and permitted directors of state-owned enterprises to avail the Prime Minister’s tax amnesty scheme.
These were made part of the revised Finance Bill 2018 and the PM’s tax amnesty scheme was also incorporated into it, reported Express Tribune.
And these changes have been incorporated into the amended Finance Bill 2018 which was submitted to the National Assembly secretariat on Tuesday.
The bill will hopefully be passed on Wednesday (today) or Thursday, which will set the stage for the budget for the upcoming financial year 2018-19 to be ratified by parliament.
The amended Finance Bill 2018 has incorporated major decreases in real estate dividends for real estate investment trusts (REIT), falling from 25 percent to 15 percent.
Also, the Federal Board of Revenue has taken back half of the recommendations for an increase in customs duties on import of cooking oil.
The incorporation of the tax amnesty scheme into the final Finance Bill 2018 would provide permanent legal cover to it once it gets approved by parliament.
And the incumbent government has made a major revision in the original Act which permits directors to take benefit of the tax amnesty scheme.
The revisions in Protection of Economic Reforms Act (PERA) 1992 have also been incorporated and made a part of the revised Finance Bill 2018.
New revisions have also been enacted in Income Tax Ordinance 2001 which sees lowering of proposed tax from 15 to 10 percent for the section linked to gain on disposal of assets outside the country.
And another revision in the ITO 2001 sees income from an offshore company being taxable at 12.5 percent.
The tax regulator has brought in the idea of Controlled Foreign Company as proposed by the Organization for Economic Cooperation and Development via the Finance Bill 2018.
However, if in later years the controlled foreign company shares the dividend, the individual will qualify to claim the tax credit based on already paid tax.
And the government has agreed to make the Alternate Dispute Resolution Mechanism (ADRM) recommendations binding on the advice of the Senate.