Tag: Remittances

Jul 22: The Federal Board of Revenue (FBR) on Monday clarified that the amendment regarding provision of National Identity Card (CNIC) number at the time of purchases had been made in the Sales Tax Act, 1990 (Section 23) and not in any other taxation statute.

This clearly means that this provision was only applicable if purchases were made from a 'Sales Tax Registered person', the FBR said in a circular issued on Monday.

It added that at present there were only 41,484 sales tax registered persons who were actually paying some tax with their returns and this provision requires that if a purchase was made from a sales tax registered person, then 'CNIC' number of the 'Buyer' was to be provided in limited situations, as explained in the following paragraphs.

Provision of CNIC number allows sales to unregistered persons also.

The law further provides this condition will not apply if the value of purchases is below Rs.50, 000 in case sale is being made to an 'Ordinary Consumer'. The term 'Ordinary Consumer' is well defined. It means purchases for own non-business use by the end consumer.

In order to further safeguard businesses operating in a reasonable manner the law specifically provides that "if it is subsequently proved that CNIC provided by the purchaser was not correct, liability of loss or penalty shall not arise against the seller in case of sale made in good faith."

This provision has inter alia been placed for 'business to business' transactions and few transaction in a value higher than Rs.50,000 by limited number of end consumers and that too from sales tax registered person only and also to avoid unverifiable, non-genuine, fake and fictitious business buyers which results in huge sales tax loss in the value chain. This is all the more necessary now onwards as Export Oriented Sectors which were zero rated will now be eligible for refunds. FBR is fully committed for automated expeditious release of refunds.

There is no intention to place any hurdle in business transaction or to use this provision for any harassment accordingly for this purpose, it is further clarified,

As stated earlier no action will be taken against the sellers if any error or incorrectness is identified subsequently provided the transaction has been made in good faith.

The meaning and operation of law with reference to the term good faith is well settled. However, in order to provide further assurance in this regard following policy guidelines are laid down.

No action under this provision will be undertaken without the approval of Chief Commissioner of the jurisdiction. Furthermore, where the incidence exceeds Rs 5 million, the action will require further approval of member operation or director general (export oriented sector) or member (IR policy) as the case may be.

No action will be undertaken unless action has been undertaken against the person who has used non-genuine CNIC.

The FBR added that it is fully conversant of cultural constraints and traditions of the country.

Therefore, in case of purchase above Rs 50,000 by an ordinary consumer being a female, the CNIC of the husband or the father will be considered valid for the purpose.

APP

July 22: Stocks marked time near their opening levels in Europe and the US on Monday after losses in Asia as traders readied for earnings reports from hi-tech heavyweights later in the week.

Oil prices spiked higher meanwhile, before easing back to conserve modest gains amid ongoing tension in the Gulf, where Iran still held a British-flagged tanker seized late last week.

With the second-quarter earnings season underway, "so far companies are beating low expectations, which may just be enough to avert an earnings recession," commented Neil Wilson at Markets.com.

"By the end of the week we should know a lot more about the state of corporate America," he added.

Among the companies that will come under scrutiny are Facebook, Google parent company Alphabet and Amazon.

On oil markets, concern focused on the Gulf, as Britain repeated its demand that Iran release the Stena Impero, which the Islamic Revolutionary Guard Corps seized on Friday in the strategic Strait of Hormuz.

"Traders are clearly a little on edge due to the importance of the passage for global oil supplies," remarked Craig Erlam at the Oanda brokerage.

"Oil prices haven't risen too much yet but if the situation deteriorates further, we should possibly brace for higher prices," he added.

Meanwhile, the International Energy Agency said Monday that "the oil market is currently well supplied", and added that it was "ready to act quickly and decisively in the event of a disruption."

In late afternoon deals in Europe, London Brent oil had gained 1.1 percent and New York crude was up by 0.6 percent.

In New York, the Dow Jones Industrial Average was flat in midday trading.

- Asian stocks slide -

Asian equities retreated earlier in the day on dimming hopes for a sharp interest rate cut by the US Federal Reserve, although all the firms on a new tech-focused board in China rallied on its opening day.

Traders took a step back after last week's gains as the New York Federal Reserve tempered comments from its president, John Williams, who had suggested the central bank could cut borrowing costs by 50 basis points at its policy meeting this month.

Bets that the Fed will only reduce rates by 25 basis points provided support to the dollar against most high-yielding, riskier currencies.

- Key figures around 1600 GMT -

• London - FTSE 100: UP 0.1 percent at 7,514.93 points (close)
• Frankfurt - DAX 30: UP 0.2 percent at 12,289.40 (close)
• Paris - CAC 40: UP 0.3 percent at 5,567.02 (close)
• EURO STOXX 50: UP 0.3 percent at 3,489.92
• Tokyo - Nikkei 225: DOWN 0.2 percent at 21,416.79 (close)
• Hong Kong - Hang Seng: DOWN 1.4 percent at 28,371.26 (close)
• Shanghai - Composite: DOWN 1.3 percent at 2,886.97 (close)
• New York - Dow: FLAT at 27,1140.92
• Euro/dollar: DOWN at $1.1216 from 1.1221
• Dollar/pound: DOWN at $1.2480 from $1.2502
• Dollar/yen: UP at 107.91 yen from 107.71 yen
• Brent North Sea crude: UP 66 cents at $63.13 per barrel
• West Texas Intermediate: UP 33 cents at $55.96

AFP/APP

Jul 22: Prime Minister Imran Khan Monday arrived at the White House for one-to-one meeting with the US President Donald Trump followed by the delegation level talks to discuss the bilateral and regional matters.

The prime minister, who is on a three-day visit to the US at the invitation of the US President, arrived for the first summit-level engagement between Pakistan and the United States since both the leaders assumed their respective offices.

As the prime minister arrived at the White House, the US President was there to receive him at the entrance. Both the leaders warmly shook hands before proceedings for the one-to-one and delegation level talks.

The honor guards of the White House saluted the prime minister who was accompanied by the Minister for Foreign Affairs Shah Mahmood Qureshi.

APP

July 22, 2019 (MLN): The State Bank of Pakistan (SBP) has issued a clarification regarding the revised chapter 11 of the Foreign Exchange (FE) Manual, includes regulations on ‘Dealings in Foreign Currency Notes and Coins etc'.

According to a press release by the SBP, there are some confusions/ misinterpretations regarding Para 2 suggesting that SBP has allowed the banks to sale/ purchase foreign currencies to/from public by amending the existing regulations.

The Statement by the SBP read “One of these revised chapters, 11, includes regulations on ‘Dealings in Foreign Currency Notes and Coins etc. by the Authorized Dealers (banks). With respect to revised Chapter 11, it has come to our notice that there are some confusions/ misinterpretations regarding Para 2 suggesting that SBP has allowed the banks to sale/ purchase foreign currencies to/from public by amending the existing regulations. In this regard, it is clarified that no such amendment has been made. It would be pertinent to mention here that even before the recent revision in Chapter 11, “every authorized branch is permitted to deal in foreign currency notes, coins, deposits, credits, drafts, traveler’s cheques, letters of credit and bills of exchange, expressed or drawn in Pakistan currency but payable in any foreign currency.” {(Para 2(iii), Chapter 2 of Foreign Exchange Manual}. Since Chapter 11 of the FE Manual specifically governs regulations regarding dealings in foreign currency notes and coins etc. by the authorized dealers, therefore, the instructions related to sale/purchase of foreign currency notes have been added in Chapter 11 with emphasis on Authorized Dealers regarding compliance with AML/CFT regulations.”

The Central Bank added “the existing instructions issued by SBP vide Notification No. F.E.1/2012-SB dated the 16th June, 2012 regarding currency declaration to the Customs authorities by the inbound travelers on amount exceeding US$ 10,000, or equivalent in other currencies, have also been incorporated in revised Chapter 11.”

July 22, 2019: The PSX Stockbrokers Association (PSA) on Monday issued a letter to the Chairman Standing Committee for Finance, Economic and Revenue Affairs, Mr. Asad Umar, requesting for the formation of a Committee for Pakistan Stock Exchange.

 “It is to recall you that Stock Brokers / TREC Holders at PSX are suffering from the various practical difficulties, so created by the Federal Board of Revenue (FBR) and Securities and Exchange Commission of Pakistan (SECP). These issues are not only persecuting the fraternity but also contributing a lot in decline of the stock market” the letter stated.

In this regard, in order to resolve the issues, PSA has requested for a committee under the supervision of Standing Committee, wherein representatives of the Association may apprise the concerned of the difficulties.

“The meetings will be leading to the revival of investors’’ confidence and the volumes at the Stock Market” the noticed added.

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