New tax amnesty scheme should be used to declare all assets: Dr Shamshad

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KARACHI: Finance Minister Dr Shamshad Akhtar while meeting Pakistan Stock Exchange’s (PSX) board of directors here on Monday urged all stakeholders that under the newly promulgated Tax Amnesty Scheme all assets or cash parked offshore or within the country should be declared.

The Caretaker Finance Minister Shamshad Akhtar met PSX board of directors and apprised the board comprising of senior brokers that all the irritants related or arising about tax amnesty scheme would soon be removed. She said a meeting will be held in Islamabad on Tuesday where officials from the Ministry of Finance (MoF), Federal Board of Revenue (FBR) and State Bank of Pakistan (SBP) will meet to discuss the amnesty scheme.

Moreover, she invited members of the board of directors of PSX, CDC and National Clearing Company of Pakistan to deliberate the issues arising after the announcement of Tax Amnesty Scheme. “This is the best scheme and serves as a well-developed plan offered by the government and one should avail it,” she said.

Dr Shamshad Akhtar said SBP would also release circular after holding discussions with the members FBR and MoF with regards to those expatriates who hold assets off-shore but do not have foreign currency or any foreign currency accounts.

She debated that no extension would be given while ensuring that the caretaker government would provide ease and comfort for people looking to avail the scheme.

“We plan to facilitate the scheme in a such a manner that tax amnesty scheme would broaden tax net and document the economy” she added.

In April the government introduced the tax amnesty scheme through which people with undeclared income earned before June 30, 2017, on assets within the country would be able to bring them in the tax net by simply paying a five per cent penalty.

Moreover, people who hold undocumented assets outside the country will also be able to declare their assets under the new amnesty scheme. Meanwhile, foreign exchange could be brought back to the country by paying a 2 per cent penalty as well.

Under the scheme fixed assets would incur a 3 per cent penalty, to be evaluated at the market value of the asset, which cannot be less than the cost of its acquisition.

Foreign liquid assets like cash, securities and bonds held abroad and in local dollar accounts would be declared with a 5 per cent penalty.

Dollar account holders in Pakistan who have purchased dollars with undeclared funds can also regularise their funds by paying a 2 per cent penalty.

Further, all remittances less than $100,000 per year per person will continue without any questions from any agency regarding the source of funds and enjoy tax exemption. All remittances greater than that amount will enjoy tax exemption but may be scrutinised by the FBR under the new scheme. Furthermore, any new foreign exchange accounts can now only be opened by tax filers.

People who take part in the amnesty scheme will enjoy exemption from scrutiny, however, politically exposed persons and their families will not be able to avail the amnesty scheme, former prime minister Shahid Khaqan Abbasi stated while announcing the scheme.