Tag: taxation

June 28, 2022 (MLN): Pakistan Stock Exchange (PSX) has directed the sponsors/majority shareholders of Saudi Pak Leasing Co. Ltd (SPLC) to provide all the concerned shareholders an option for selling their shares to them at a price to be fixed by the Exchange in accordance with clause 5.14 of the PSX Regulations, a notice issued by PSX said today.

“In case of failure of the sponsors/ majority shareholders of the company to comply with the compulsory buy-back directions and/or failure to comply with the requirements of the PSX Regulations or failure to rectify the non-compliance(s) within a period 90 days i.e., up to Thursday, September 22, 2022, the Exchange will proceed to delist the company u/c 5.11.2. (f) of the PSX Regulations’, it added.

The case of the company, u/c 5.1 1.2. (g) of the PSX Regulations, will also be forwarded to the Securities & Exchange Commission of Pakistan for initiating further action as deemed appropriate under relevant provisions of the Securities Act, 2015 and the Companies Act, 2017.

It is pertinent to note that despite the lapse of considerable time and various reminder notices by the exchange for compliance deadline, the company has failed to rectify the default (s), particularly of clause 5.11.1. (j) of the PSX Regulations i.e., its license as NBFC has been canceled within the timeline specified under the PSX Regulations.

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June 28, 2022 (MLN): The amount of tax collection by the Federal Board of Revenue (FBR) for the first time reached Rs6 trillion in the fiscal year to date (FYTD).

Last week, the FBR tax collection stood at Rs5.82tr. FBR will likely achieve a tax collection target of Rs6.1tr by the end of FY22.  

In 11MFY22, the FBR collected net revenue of Rs5.35tr which represented a growth of about 28.4% over the collection of Rs4.16tr during the same period last year. 

It is pertinent to mention that a constant growth trajectory in revenue collection has been achieved despite massive tax relief given by the government on various essential items to the common man. For the first time ever in the country’s history, Sales Tax on all POL products has been reduced to zero which cost FBR Rs45 billion in May 2022.

It is also worth sharing that FBR has introduced a number of innovative interventions both at policy and operational levels with a view to maximizing revenue potential through digitization, transparency, and taxpayers' facilitation. This has not only resulted in ensuring transparency, taxpayers’ facilitation, and the ease of doing business but also translated into healthy and steady growth in revenue collection.

Likewise, the incumbent top leadership of FBR has launched a new culture of clean taxation with a clear focus on collecting only the fair tax and not holding up refunds that are due to be paid.

This has not only fast-tracked the process of bridging the trust deficit between FBR and Taxpayers but also ensured the much-needed cash liquidity for the business community. That's precisely why FBR continues to surpass its assigned revenue targets despite challenges and price stabilization measures adopted by the government.

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June 28, 2022: Prime Minister Shehbaz Sharif on Tuesday said the current economic scenario of Pakistan required tactical solutions to address economic problems and stressed rising above politics to sort out the financial issues confronting the country.

Addressing the ‘Turn Around Conference’, he said economic self-reliance was the key to achieving the goals of development and prosperity. The event organized by the Ministry of Planning Development and Special Initiatives gathered stakeholders from all walks of life with the objective of finding solutions to the country’s current socio-economic issues.

The prime minister said Pakistan was facing many external and internal challenges which were compounded by the existing commodity super-cycle and the geopolitical situation.

He said as the economic growth did not offer enough opportunities for national progress, short-term measures could act as a catalyst for speeding up the growth. He said financial self-reliance was the top priority of the coalition government. He said focusing on the areas of agriculture, agro-based industry and exports was vital to strengthen the national economy.

He stressed the need for judicious utilization of the $2 billion tranche from the International |Monetary Fund (IMF) and pledged that every single penny would be spent prudently.

He also mentioned the support of China during the tough financial times and helping Pakistan in its journey towards economic stability. PM Sharif said there was no dearth of talent and potential in Pakistan and emphasized setting the right direction to achieve the goals of prosperity.

He pointed out that several vital projects such as Reko Diq were abandoned in the past that damaged the development agenda of the country. He said also that many power generation projects were stopped resulting in a shortage of electricity and impacting industrial growth. The prime minister expressed satisfaction that the conference engaged all the relevant stakeholders who could hold the development sector together with from across the nation. He said wider and inclusive consultations of experts belonging to diversified fields could be helpful in providing solutions to come out of this economic quagmire.

Finance Minister Miftah Ismael said the government gave relief to people despite tough circumstances.He said the government imposed direct taxes and also the Super Tax to help the country become self-reliant. He said the previous government took Rs 20,000 billion loan in around four years which put a heavy burden on the national exchequer. He mentioned that tax had been levied on the rich and vowed to also bring the traders and shopkeepers into the tax net.

Federal Minister for Planning Development and Special Initiatives, Professor Ahsan Iqbal said the aim was to take input, understand and resolve hurdles in economic growth in order to place the country’s economy back on track.

He said the solutions of the conference would be aimed at short-term results, adding that if substantial, these due deliverance compact ideas could be extended to mid and long-term objectives.

He said the government had already taken necessary short-term actions to stabilize the economy and deal with the looming balance of payments crisis. However, he said, the government’s focus is to ferret out the medium to long-term solutions to optimize the country’s economy to tap its full potential in line with Vision 2025. The conference was attended by representatives of political parties, federal ministries, provincial governments, national and international private sector entrepreneurs, international development and financial institutions, academia, think tanks, independent experts, NGOs and civil society.

APP

June 28, 2022 (MLN): The Pakistan Credit Rating Agency Limited (PACRA) has maintained ratings of Soneri Bank Limited at ‘A+’ for the long term with a stable outlook, the company filing on PSX showed on Tuesday.

The ratings reflect Soneri Bank’s maintained a business profile as reflected by system share in terms of deposits (end-Dec21: 1.7%, end-Dec20: 1.8%). SNBL’s customer deposits observed growth of ~13%, where CASA recorded further improvement (CY21: ~70%; CY20: ~69%).

Going forward enhanced deposit mobilization will remain vital in maintaining system share. Net income witnessed an increase of 18.9% YoY attributable to lower provisioning and impairment charge.

Sustainability in net markup income & non-markup income and continued enhancement in non-fund-based exposure is important for future years. The advance book recorded a marginal uptick, whereas, the infection ratio declined (CY21: 5.9%; CY20: 6.2%), owing to a marginal decline in NPLs.

The Investment book has expanded significantly by 31% YOY, dominated by investments in PIBs. Going forward, the strategy is to strengthen the existing good relationships and digital platform by offering various unique solutions to its customers. Pakistan’s economy has gone through several varied phases in the last two years due to the COVID-19 pandemic.

The banking sector continued to flourish with high profitability. Going forward, the macro-economic environment is beset with myriad challenges due to heightened interest rate, tightening of demand, rupee depreciation, and higher inflation. This has repercussions for all segments of the economy. The Bank’s Tier-I ratio stands at 12.23% as of end-Dec21.

Total CAR stands at 13.8% (CY20: 17%). With dilution recorded in CAR of the bank, prudent capital management remains essential.

The rating is a function of a bank's ability to maintain its market position in the banking industry while strengthening its overall risk profile. Bringing efficiency to the operational structure is important for long-term growth. In the comparative landscape, adding granularity to deposits and advances is critical.

Meanwhile, a sustainable increase in system share and consequent profitability would be ratings positive.

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June 28, 2022: Moody's ratings agency has confirmed that Russia defaulted on foreign debt for the first time in a century after bond holders did not receive $100 million in interest payments.

The missed payments follow a series of unprecedented Western sanctions that have increasingly isolated Russia following its invasion of Ukraine.

Russia lost the last avenue to service its foreign-currency loans after the United States removed an exemption last month that allowed US investors to receive Moscow's payments.

"On 27 June, holders of Russia's sovereign debt had not received coupon payments on two eurobonds worth $100 million by the time the 30-calendar-day grace period expired, which we consider an event of default under our definition," Moody's said.

"Further defaults on future coupon payments are likely," the agency said in a statement late Monday.

Moscow said Monday there were "no grounds to call this situation a default" as the payments did not reach creditors due to the "the actions of third parties".

The country last defaulted on its foreign debt in 1918, when Bolshevik revolution leader Vladimir Lenin refused to recognise the massive debts of the deposed tsar's regime.

AFP/APP