1 of 92024-06-30

Finance Act, as published 30 June 2024

This is the Finance Act as it stood on 30 June 2024. It runs to 89 pages and contains 14 sections, with 0 amendment footnotes.

What this document is

Published by the Federal Board of Revenue as part of the Finance Act collection. A consolidation of this kind folds every amendment made up to its cover date into the text, so it shows the law as it stood on 30 June 2024 rather than as originally enacted.

The date above was taken from the file name rather than a consolidation statement on the cover, so treat it as approximate.

The shape of this version

The operative text holds roughly 21,784 words across 14 sections.

What changed since the previous version

Against the version published 30 June 2023, this one has 10 new sections and 4 that no longer appear.

New in this version

section 1, Short title and commencement
section 8, Amendments of The Income Tax Ordinance, 2001 (XLIX of 2001)
section 9, Amendments of the Federal Excise Act, 2005
section 10, Amendments of The Federal Board of Revenue Act, 2007 (IV of 2007)
section 11, Amendment of the Public Finance Management Act, 2019
section 11E, Assessment of tax and recovery of tax not levied or short levied or erroneously refunded
section 11F, Failure to withhold sales tax
section 11G, Limitation for assessment
section 12, Amendments of the Finance Act, 2022 (XIII of 2022)
section 191B, Prosecution for non-registration

No longer present

These appeared in the previous version and not in this one. That usually means omission by a later law, though it can also mean a heading was formatted in a way the extraction did not recognise.

section 3, Amendments of the Members of Parliament (Salaries and Allowances) Act, 1974 (XXVII of 1974)
section 5, Amendments of the Sales Tax Act, 1990
section 38, Alternative Dispute Resolution
section 65, Film and Drama Finance Fund.” ; 8. Amendments of the Federal Excise Act, 2005

The source file


File name	`2024630146346801FinanceAct-2024.pdf`
Pages	89
Size	1.25 MB
Text extraction	markitdown
Extraction confidence	high
Position in this collection	9 of 9

SHA-256 of the source PDF:

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Checking that value against the file you download confirms it is the same document these figures came from.

A note on these figures

Counts here are produced by software reading the PDF, not compiled by hand. The same method is applied to every document, which makes comparisons between versions meaningful, but a section with unusual formatting can be missed. Treat them as close measurements and the official document as the authority.

This is information, not legal or tax advice. Qanoon Digest is independent and not affiliated with the Federal Board of Revenue or the Government of Pakistan.

The full text of this version

All 14 sections as they appear in this document, reproduced from the source PDF. Amendment footnotes follow at the end.

1. Short title and commencement

(1) This Act shall be called the Finance Act, 2024.

(2) It shall, unless specified otherwise, come into force on the first day of July, 2024.

2. Amendments of the Stamp Act, 1899 (II of 1899)

In the Stamp Act, 1899 (II of 1899), as is in force in the Islamabad Capital Territory, in Schedule-I,-

(A) for Article 23, the following shall be substituted, namely:-

(a) any instrument or set of instruments relating to a future Rupees transaction; and

(b) in any other case.

exemption (1), and after exemption (1), numbered as aforesaid, the following new exemption (2) shall be added, namely: -

-(2) Transfers which are covered under Conveyance described in Article 23(1)(a).‖.‖

Ordinance, 1961 (XXV of 1961).-In the Petroleum Products (Petroleum Levy)

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 225

Ordinance, 1961 (XXV of 1961), for the Fifth Schedule, the following shall be substituted, namely:-

-The Fifth Schedule [see Sections 3 (1) and 7]

Maximum petroleum unit) Metric ton Pakistan)

4. Amendments of the Customs Act, 1969 (IV of 1969)

In the Customs Act, 1969 (IV of 1969), the following further amendments shall be made, namely:-

(1) in section 2,-

defined in the Pakistan Nuclear Regulatory Authority Ordinance, 2001, (III of 2001);‖; and

226 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(b) after clause (qa), the following new clause shall be inserted, -(qaa) -radioactive material‖ means the radioactive material as defined in The Pakistan Nuclear Regulatory Authority Ordinance 2001 (III of 2001);‖;

(2) after section 3CCC, the following new section shall be inserted, -3CCD. Directorate General of National Targeting Centre.- The Directorate General of National Targeting Centre (NTC) shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors, Assistant Directors and such other officers as the Board may, by notification in the official Gazette, appoint.‖;

(3) after section 3CCD, as amended aforesaid, the following new section shall be inserted, namely:- -3CCE Directorate General of Combating Trade Based Money Laundering.-The Directorate General of Combating Trade Based Money Laundering (TBML) shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors, Assistant Directors and such other officers as the Board may, by notification in the official Gazette, appoint.‖;

(4) in section 5, for sub-section (1), the following shall be substituted, -(1) The Board may, by notification in the official Gazette and subject to such limitations or conditions as may be specified therein, delegate any of its functions and powers to the Chairman, or empower by name or designation-

(a) any Member or Director General to exercise the powers of the Board or Chairman;

(b) any Collector of Customs to exercise any of the powers of a Chief Collector of Customs under this Act;

(c) any Additional Collector of Customs or Deputy Collector of Customs to exercise any of the powers of a Collector of Customs under this Act;

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 227

Collector of Customs to exercise any of the powers of an Additional Collector of Customs under this Act;

the powers of a Deputy Collector of Customs under this Act; and

designation.‖;

enforcement of this Act‖ shall be inserted;

(6) in section 7, after the word -Police‖, occurring for the first time, the expression -, Intelligence Bureau‖ shall be inserted;

(7) in section 17, in the proviso, for the words -Chief Collector or Director General‖, the words -Additional Collector of Customs or Additional Director‖ shall be substituted;

(8) in section 19, in sub-section (5), in second proviso, for the figure -2024‖, the figure “2025” shall be substituted;

(9) in section 81, in sub-section (1), in third proviso,-

Valuation Ruling (PVR)‖ shall be inserted; and

expression -or a Publication Valuation Ruling (PVR)‖ shall be inserted;

(10) in section 156, in sub-section (1), in the Table,-

new sub-serial numbers shall be added, namely:-

228 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

shall be dealt with under the National Command Authority Act, 2010, (V of 2010), if- material is that as defined in the in case of-

than fifteen grams, or;

enriched to twenty percent or more of U-235, is less than fifteen grams, or;

enriched to ten percent U- 235 but less than twenty percent of U-235, is less than 1kg, or;

U-235 is less than ten kgs; or;

than fifteen grams.

(b) the quantity and form of nuclear therein, and determined by PNRA,

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 229

in case of;

grams but does not exceed 500 grams, or;

enriched to twenty percent or more of U-235, is fifteen grams or more but does not exceed one kilogram, or;

U-235 but less than twenty percent of U-235, is 1kg or ten kgs, or;

less than ten percent U-235, is more than ten kgs, or;

hundred grams;

composition exceeding eighty percent of plotunium-238, is two Kgs, or;

230 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

enriched to twenty percent or more of U-235, is more than one Kg but does not exceed five kilograms, or;

(iii) unirradiated uranium U-235 but less than twenty than ten kgs, or;

(iv) unirradiated U-233, is more than five hundred grams but and

material is that as defined in the or imprisonment for a million rupees. in case of-

composition exceeding 80% than two Kgs, or;

enriched to twenty percent or more of U-235, is more than five kilograms, or;

(iii) unirradiated U-233, is more than two Kgs; and

Command Authority Act, 2010, if-

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 231

RadioactiveSources (PAK/926)

or any amendment therein as determined by the PNRA, does not exceed one (1) in numeric number;

Radioactive Sources-(PAK/926) exceed ten in numeric number; Radioactive Sources-(PAK/926) more than ten (10) but does not number; and under clause (c).

(b) against S.No.9, in column (2), the expression -but not less than‖ shall be omitted;

232 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(d) against S.No.85, in column (2), for the expression -of twenty- five thousand‖, the words -not less than one hundred thousand‖ shall be substituted;

(e) in S.No. 89, after sub-serial number (ii), a new sub-serial number shall be added, namely:- -(iii) in case any smuggled goods, such person shall be liable liable to confiscation, seized and to a penalty not exceeding placed in the custody of the owner ten times the value of such of the goods or any person goods and upon conviction holding the goods in his by a Special Judge, shall possession or charge are found further be liable to removed illegally, exchanged, imprisonment for a term pilfered or disposed of in any not exceeding six years or manner, to a fine not exceeding one million rupees or both.‖

(f) against S. No. 90,-

(i) in column (2), the words -but not less than‖ shall be omitted;

(ii) the existing sub-serial number shall be numbered as sub-serial number (i) and thereafter, a new sub-serial number shall be added, namely:- -(ii) in case seized goods liable to such goods shall be liable confiscation not being goods to confiscation and any referred to in clause 89, placed in person concerned in the the custody of the owner of the offence shall be liable to a goods or any person holding the penalty not exceeding two goods in his possession or charge times of the value of such are found removed illegally, goods and upon conviction exchanged, pilfered or disposed of by a Special Judge, shall in any manner, further be liable to imprisonment for a term not exceeding six months or to a fine not exceeding fifty thousand rupees or both.‖;

(11) for section 194, the following shall be substituted, namely:- “194. Appellate Tribunal.-(1) There shall be established a Customs Appellate Tribunal, hereinafter called as the

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 233

Appellate Tribunal to exercise jurisdiction, powers and perform functions conferred upon it under this Act.

shall be appointed by the Federal Government in such numbers, conditions as the Federal Government may prescribe by rules, which shall be made and take effect notwithstanding anything Service Commission Ordinance, 1977 (XLV of 1977) or any other law or rules, for the time being in force:

Provided that the existing members including Chairman of the Appellate Tribunal shall continue to hold office, on the same commencement of the Finance Act, 2024, till the completion of provided in the proviso to sub-section (5).

member of the Appellate Tribunal, if he-

fifteen years having expertise in Customs Laws and experience of pleading at least fifty Customs cases at qualifications as may be prescribed by rules;

BS-21 or above; or

BS-20, having served in such grade for three years or more.

Chairman shall hold office for a period of three years provided that the Federal Government may reappoint the Chairman for such further term or terms as it may deem appropriate.

hold office on attaining the age of sixty-two years provided that the members falling under clauses (b) and (c) of sub-section (3)

234 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

shall cease to hold office on attaining the age of superannuation, under the law regulating their service:

Provided that a member including the Chairman may be removed by the Federal Government, on the recommendation of performance review committee, to be constituted by the rules made under sub-section (2), at any time before the expiry of his term or attaining the age of superannuation, as the case may be, prescribed by the rules made under sub-section (2).

(12) for section 194A, the following shall be substituted, namely:-

-194A. Appeals to the Appellate Tribunal.-(1) Any following orders may appeal to the Appellate Tribunal against such orders:- section 179;

(b) section 193; Customs Valuation under section 25D: special bench of at least two members one Judicial Member and one Technical Member, constituted by the Chairman; and the Chief Collector of Customs under provisions of this Act and the rules made thereunder provided that consisting of one technical member and one judicial member: discretion, refuse to admit an appeal in respect of an order referred to in sub-section (1), where-

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 235

option having been given to the owner of the goods to pay a fine in lieu of confiscation under section 181; or

(ii) in any disputed case other than a case where the determination of any question having a relation to rate of duty of customs or to the value of goods for purposes of assessment is in issue or is one of the points in issue, the difference in duty involved or the duty involved; or

(iii) the amount of fine or penalty determined by rupees. by the prescribed fee so specified in sub-section (3) under this section shall be filed, within thirty days from the date on which communicated to the Board or the Collector of Customs, or as the case may be, the other party preferring the appeal. other than an officer of customs, shall be accompanied by a fee thousand rupees in case other than a company. sufficient cause for not presenting it within that period. this section, the assessed or adjudged amount of duty and taxes shall be payable, unless recovery thereof has been stayed by the Appellate Tribunal: Provided that on filing of application for grant of stay, the Appellate Tribunal may after affording an opportunity of being heard to the Collector having jurisdiction, for reasons to be recorded, stay the recovery of duty and taxes for thirty days, during which period a notice shall be issued to the respondents and after hearing the parties, order may be confirmed or varied as the Tribunal deems fit but stay order shall in no case exceed ninety days.

236 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

reference or appeal was preferred with the approval of Collector appellate forum or the Court, such reference or appeal shall be deemed to have been so filed by the Collector and for removal of doubt it is hereby declared that the pending appeals shall not abate solely on this ground.‖;

(13) for section 194B, the following shall be substituted, namely:- Tribunal.-(1) The Appellate Tribunal may after giving the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit confirming, modifying or annulling the decision or order appealed against. The Appellate Tribunal may record additional evidence and decide the case but shall not remand the case for recording the additional evidence: Provided that the appeal shall be decided within ninety days of filing the appeal: Provided further that where an appeal is not decided consent of both parties and upon reasons to be recorded in writing may extend for a further period of sixty days. shall- relating to alternate dispute resolution under section 195C of the Act; and appeal, fix date or dates for hearing and decision of the appeal in consultation with both the Appellant and Respondent and in accordance with the rules. date or dates fixed, and no adjournment shall be granted except- to be recorded in writing by the Appellate Tribunal; and

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 237

Tribunal may deem fit, which shall not be less than fifty thousand rupees. fifteen days from the date of communication of order, with a arising therein from accidental slip and omission apparent from the record, amend any order passed by it under-sub-section (1) and shall make such amendments if the mistake is brought to its notice by the Collector of Customs or the other party to the appeal: Provided that an amendment which has the effect of enhancing the assessment or reducing a refund or otherwise increasing the liability of the other party shall not be made under this sub-section, unless the Appellate Tribunal has given notice reasonable opportunity of being heard. order passed by it under this section, disposing of an appeal, to Director General Valuation, and the other party to the appeal: Provided that the order of the Appellate Tribunal shall remain pending for thirty days, if the Collector or other party to the appeal, prefers a reference to the High Court within this period. an order passed by the Appellate Tribunal in appeal shall be final.‖;

(14) for section 194C, the following shall be substituted; Chairman from amongst the members thereof.

(3) and (4), the procedure of the Appellate Tribunal including constitution of benches, case management system, distribution of cases and other matters ancillary or incidental thereto shall be regulated by the rules under this Act.

238 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

case involving duty, tax, penalty or fine exceeding five million members and shall include at least one judicial member and one technical member: Benches consisting of two or more - Tribunal authorized in this behalf by the Chairman may, sitting singly, dispose of any case which has been allotted to the bench of which he is a member where,- having been given to the owner of the goods to pay a fine in lieu of confiscation under section 181; or involved, or the amount of fine or penalty involved does not exceed five million rupees. point, the point shall be decided according to the opinion of the majority, if there is a majority, but if the members are equally divided, they shall state the point or points on which they differ and the case shall be referred by the Chairman for hearing on such point or points by one or more of the other members of the Appellate Tribunal, and such point or points shall be decided according to the opinion of the majority of the members of the Appellate Tribunal who have heard the case including those who first heard it: Provided that, where the members of a Special Bench are equally divided, the points on which they differ shall be decided by the Chairman. discharging its functions, have the same powers as are vested in

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 239

a court under the Code of Civil Procedure, 1908 (V of 1908), when trying suit in respect of the following matters, namely:-

(b) examining him on oath; other documents; and sections 193 and 228 and for the purpose of section 196 of the Pakistan Penal Code (Act XLV of 1860), and the Appellate Tribunal shall be deemed to be a Court for all the purposes of sections 480 and 482 of the Code of Criminal Procedure, 1898 (Act V of 1898).‖;

(15) for section 195C, the following shall be substituted, namely:- Notwithstanding anything contained in this Act, or the rules made there under, any aggrieved person, in connection with any dispute pertaining to liability of customs-duty, admissibility of procedural and technical condition which is under litigation in any court of law or an appellate authority, except in the cases interpretation of question of law having larger revenue impact in the opinion of the Board is involved, may apply to the Board for the appointment of a committee for the resolution of dispute in appeal. sub-section (1) shall be accompanied by an initial proposition for resolution of the dispute, including an offer of payment of duties and taxes. sections (1) and (2), after examination of the application of an aggrieved person, appoint a committee, within fifteen days of receipt of such application, consisting of-

240 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(a) a retired judge not below the rank of a judge of a High Court, who shall also be the Chairperson of the Committee, to be nominated by the Board from a panel notified by the Law and Justice Division for such purpose;

(b) an officer of customs not below the rank of Chief Collector having jurisdiction over the case; and

(i) chartered accountants, cost and management accountants and advocates having minimum ten years experience in the field of taxation: Provided that the taxpayer shall not nominate a chartered accountant or cost and management accountant or an advocate if the said chartered accountant, cost and management accountant or the advocate is or has been an auditor or an authorized representative of the taxpayer;

(ii) reputable businessmen as nominated by Chambers of Commerce and Industry; and

(iii) officer of Customs Service of Pakistan who stood retired in BS 21 or above.

(4) The Board shall communicate the order of appointment of committee to the aggrieved person, court of law or the appellate authority where the dispute is pending and the concerned Collector.

(5) The committee constituted under sub-section (3) shall examine the issue and may, if it deems necessary, conduct inquiry, seek expert opinion, direct any officer of customs or any other person to conduct an audit and shall decide the dispute by majority, within forty-five days of its constitution extendable by another fifteen days for the reasons to be recorded in writing.

(6) The recovery of duties and taxes payable by the applicant in connection with any dispute for which a committee has been appointed under sub-section (3) shall be deemed to have been stayed from the date of appointment of the committee

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 241 up to the date of decision of committee or its dissolution, as the case may be.

(7) If the aggrieved person is satisfied with the decision of the committee, he shall withdraw the appeal pending before the court of law or any appellate authority and communicate the order of withdrawal to the Collector within thirty days of the service of the decision.

(8) The decision of the committee under sub-section (5) shall be binding on the Collector subject to the provision of sub- section (7).

(9) Subject to sub-section (7), the Collector shall also withdraw the appeal, if any, pending before any court of law or an appellate authority in respect of dispute as mentioned in sub- section (1) within thirty days of the communication of the order of withdrawal by the aggrieved person to the Collector.

(10) If the committee fails to make recommendations within a stipulated period of sixty days under sub-section (5), the Board shall dissolve the committee by an order in writing and the matter shall be decided by the appellate authority where the dispute is pending.

(11) The Board shall communicate the order of dissolution to the court of Law or the appellate authority and the Collector and the aggrieved person.

(12) The aggrieved person, on receipt of the order of dissolution, shall communicate the order to the appellate authority, which shall decide the appeal within the stipulated period as provided under the relevant provision, of the communication of the said order.

(13) The aggrieved person shall make payment of customs duty and other taxes as determined by the committee under sub- section (5) and all decisions, orders and judgments made or passed shall stand modified to that extent.

(14) The Board may prescribe the amount to be paid as remuneration for the services of the members of the committee, other than the member appointed under clause (b) of sub- section (3).

242 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(15) The Board may, by notification in the official Gazette make rules for carrying out the purposes of this section, including the procedures and manner of conducting of ADR committee meetings.‖;

(16) for section 196, the following shall be substituted, namely:- -196. Reference to High Court.-(1) Within thirty days of the order of the Appellate Tribunal under sub-section (3) of section 194B, the aggrieved person or any officer of Customs not below the rank of Deputy Collector or Deputy Director, authorized by the Collector or Director in writing, may file a reference, in the prescribed form, along with a statement of the case, before the High Court, stating any question of law or a mixed question of law and fact arising out of such order: Provided that the applicant shall also file complete record of the Appellate Tribunal within fifteen days of preferring an application under this section.

(2) A reference to the High Court under this section shall be heard by a Special Bench, constituted for hearing cases under this section, comprising of not less than two judges of the High Court and the provisions of section 98 of the Code of Civil Procedure, 1908 (Act V of 1908), shall apply to the extent possible to such cases, notwithstanding anything contained in any other law for the time being in force.

(3) The Special Bench shall decide a reference within six months from the date of its filing. The High Court upon hearing a reference under this section shall decide the question of law or a mixed question of law and fact raised in the reference and pass judgment thereon specifying the grounds on which such judgment is based and the Appellate Tribunal’s order shall stand modified accordingly.

(4) The High Court shall establish a case management system to ensure that sufficient number of Special Benches are constituted, so as to ensure that a reference filed under this section is decided within the stipulated six months.

(5) Notwithstanding that a reference has been made to the High Court, the duty shall be payable in accordance with the order of the Appellate Tribunal:

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 243 Provided that the recovery shall not be made by the Collector for fifteen days from the date of communication of the order of the Appellate Tribunal: Provided further that, the amount of duties and taxes if reduced as a result of the judgment in the reference, and any amount of duty and tax is found refundable, the High Court may, on application submitted by an officer of Customs authorized by the Collector or Director, within thirty days of the judgment of the High Court, that he wants to prefer petition for leave to appeal to the Supreme Court, make an order authorizing the Collector to postpone the refund until the disposal of the appeal by the Supreme Court.

(6) Where recovery of duty has been stayed by the High Court through an order, such order shall cease to have effect on the expiration of a period of six months following the day on which it is made unless the reference is decided, or such order is withdrawn by the High Court earlier.

(7) Section 5 of the Limitation Act, 1908 (IX of 1908), shall apply to an application made to the High Court under sub- section (1).

(8) An application under sub-section (1) by a person other than the officer of Customs authorized by the Collector or Director shall be accompanied by a fee of fifty thousand rupees.

(9) Notwithstanding anything in this Act, where any reference or appeal was preferred with the approval of Collector by an officer below the rank of Collector, and the reference or appeal is pending before appellate forum or the Court, such reference or appeal shall be deemed to have been preferred and shall be deemed always to have been so preferred by the Collector or Director.

(10) The Court shall send a copy of the judgment under the seal of the Court to the Appellate Tribunal.‖;

(17) in the First Schedule,-

(i) in Chapter 11, in column (1), for PCT code -1102.9000‖ and the entries relating thereto in columns (2), (3) and (4), the following shall be substituted, namely:-

244 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(ii) in Chapter 27, in the Table, in column (1), against PCT codes -2710.1931 and 2711.1100‖, in column (4), for the figure -11‖, the figure -0‖, shall be substituted;

(iii) in Chapter 29, against PCT code -2930.9091‖, in column (3), in the -Description, for the sign -<‖, the words -less than‖ shall be substituted;

(iv) in Chapter 39, for the PCT -3907.2900‖, and the entries relating thereto in column (2), (3) and (4), the following new PCT code and the entries relating thereto in column (2), (3) and (4), shall be substituted, namely: -

HCFC-142b

(v) in Chapter 73, in the Table, in column (1), against PCT Codes -7311.0040‖, in column (4), for the figure -11‖, the figure -16‖, shall be substituted;

(vi) in Chapter 84, in the Table, in column (1), -

-8413.7019‖, shall be inserted; and

(b) for PCT code -8481.3000‖, and the entries relating thereto in column (2), (3) and (4), the following new PCT code and the entries relating thereto in column (2), (3) and (4), shall be substituted, namely:-

(nonreturn) valves:

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 245

(vii) in Chapter 85, in the Table, in column (1), after PCT code -8544.6010‖, and the entries relating thereto in column (2), (3) and (4), the following new PCT code and the entries relating thereto in column (2), (3) and (4), shall be inserted, namely:- -8544.6020 — Photovoltaic power 20‖; cable having single conductor of kind used for solar

(viii) in Chapter 90, in the Table, in column (1),-

(a) for PCT code -9004.9000‖ and the entries relating thereto in columns (2), (3) and (4), the following shall be substituted, namely:- – Other: 9004.9010 —Night 11 vision goggles 9004.9090 —Other 11‖;

(b) after PCT Code -9018.3970‖, the following new PCT codes and entries relating thereto in columns, (1), (2), (3) and (4), shall be inserted, namely: - –– Evacuated tubes for the collection and transport of blood: 9018.3981 ––Of glass 20 9018.3982 ––Of PET 20 9018.3989 ––Other 20‖;

(ix) in Chapter 99,-

(a) in Sub-chapter-II, in the table, in column (1), against PCT code -9908‖, in column (2) for serial (i), the following shall be substituted, namely:- -(i) Goods received as gift or donation from a foreign government or organization by the Federal or Provincial Government or any public sector organization subject to recommendation of the Minister Incharge and concurrence by the Federal Board of Revenue subject to condition that the

246 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I concerned Ministry shall verify the genuineness of such cases and furnish an undertaking to the effect that donated goods shall not be sold, utilized or disposed of otherwise than for the purpose for which the same have been imported.‖;

(b) in Sub-chapter-V, in the table, in column (1), for the PCT code 9917, the following shall be substituted, 9917 (1) Goods imported into and exported 0‖ (except to tariff area of Pakistan) from the Export Processing Zones established under the Export Processing Zone Authority Ordinance, 1980 (IV of 1980) and any enactment relating to Gwadar Special Economic Zone, subject to such conditions, limitations and restrictions as the Federal Board of Revenue may impose from time to time. 2. Capital goods, as defined in the preamble of Part-I of the Fifth Schedule to the Customs Act, and firefighting equipment, except the items listed under Chapter 87 of the Pakistan Customs Tariff, imported for installation and development of Special Economic Zone (SEZ) on one-time basis, as prescribed in the SEZ Act, 2012 and rules thereunder subject to such conditions, limitations and restrictions as the Federal Board of Revenue may impose from time to time, by.-

(i) Zone Developers for setting up of a Special Economic Zone (SEZ) or Co-developer as defined in Special Economic Zone Rules, 2013, shall also be entitled to avail the same incentives and exemptions for the same period as available to the Developer under the SEZ Act 2012, subject to condition that the Developer of the SEZ relinquishes its rights to the incentives and exemptions in favour of the Co-developer; provided further that the

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 247 respective Special Economic Zone Authority duly endorses such reassignment, and ensures that such reassignment shall not be misused; and

(ii) Zone Enterprises for installation in that zone.

(3) Following imports for construction, development and operations of Gwadar port and Free Zone Area subject to such conditions, limitations and restrictions as the Federal Board of Revenue may impose from time to time:-

(i) Equipment and materials (plant, machinery, equipment, appliances and accessories), imported by the Concession holder, its operating companies including Gwadar International Terminals Limited and Gwadar Marine Services Limited, and their contractors and sub-contractors exclusively for construction and operation of the terminals and the Free Zone Area for a period of forty (40) years commencing from 18th April, 2007;

(ii) Ship bunker oils imported by the Concession holder or its operating, companies and their contractors and sub-contractors for the sole purposes of supplying fuels and lubricants to all visiting ships including foreign and local and fishing vessels at Gwadar Port for a period of forty (40) years commencing from 18th April, 2007;

(iii) Vehicles imported by the concession holder and its operating companies for a period of twenty-three (23) years commencing from 18th April, 2007; for construction,

248 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I development and operations of Gwadar Port and Free Zone Area under the regulatory mechanism. The regulatory mechanism for such vehicles, including the number and types importable, shall be devised by the Ministry of Port & Shipping and FBR (in consultation with the Provincial Government if so required) and notified by the FBR; and

(iv) Imports by the following businesses to be established in the Gwadar Free Zone Area for a period of 23 years with effect from 1st July, 2016, packaging, distribution, stuffing and de- stuffing, CFS, container yard, warehousing including cool and cold rooms, transhipment, labelling, light end assembly and re-assembly, imports and exports/value added exports, value adding of imports, other similar or related businesses activities and such commercial activities as are required to support the free zone. 4. Capital goods including but not limited to materials, plant, machinery, equipment, hardware and software, if not manufactured locally, imported for consumption within Special Technology Zone, subject to such conditions, limitations and restrictions as the Federal Board of Revenue may impose from time to time, for a period of ten years by:-

(i) Special Technology Zones Authority and Zone developers from the date of signing of the development agreement; and

(ii) Zone enterprises from the date of issuance of license.

(5) Imports by persons as authorized under Export Facilitation Scheme, 2021

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 249 notified by the Federal Board of Revenue with such conditions, limitations and restrictions.

(i) for the PCT code 9919, the following shall be substituted, namely:- 9919 Goods mentioned below, imported 0‖; temporarily into Pakistan with a view to subsequent exportation within the period of six months further extendable by the Chief Collector of Customs on case to case basis for a period not exceeding six months, subject to furnishing of bank guarantee or other security/guarantee as determined by Federal Board of Revenue equivalent to customs duty chargeable at the rates specified in Chapter 1 to 97 to the First Schedule to the Act for such goods and other taxes leviable thereon. 1. Packing material used or required to be used as external or internal covering of goods, or as holders of goods, or as holders on which goods rolled, wound or attached provided such material do not change their original shape or form. Packing material if imported filled, it may be re-exported empty, and if imported empty it may be re-exported filled. 2 (a). Machinery and equipment for repair imported by manufacturer or authorized agents based in Pakistan, representing foreign manufacturers duly registered with the Sales Tax Authorities, having in house facility for repair, Refurbishment or value addition of machinery. (b). Carpets imported for the purpose of repairing by the Sales Tax registered manufacturers having in-house facility.

250 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I 3. Professional equipment imported by scientists, IT experts, technicians, doctors, engineers, etc. either imported in their own name or in the name of the company in Pakistan for which these are imported. 4. Tubes or cops of metal plastic or other durable material which are imported wrapped with yarn. 5. Goods imported for demonstration, display, test or trial purposes. 6. Dry fruits imported from Afghanistan. (ii) for the PCT code 9921, the following shall be substituted, namely:- 9921 (i) Container (PCT code 86.09) for 0‖; transportation of cargo if imported by the shipping companies for use on board the ships and for transportation of cargo to and from inland container depots or container freight stations subject to the furnishing of indemnity bond by the shipping lines, equal to the amount of duty and taxes to the respective Collector of Customs. The indemnity bond is to be discharged on receipt of proof of export of the containers.

(ii) Duty paid container (PCT code 86.09) used for transportation of export cargo by the exporters, on its reimportation.

(d) in Sub-chapter- VII, in column (1) in the table, PCT code 9932 and the corresponding entries relating thereto in columns (2) and (3), shall be omitted.

(18) in the Fifth Schedule,- (A) in Part-I, in column (1),-

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 251

(i) in S. No. 1, in column (2) for sub-serial (K), and the corresponding entries relating thereto in column (3)

and

2.Ministry of National manner and format as effect that the imported against a specific user obtained under Section 155D of the Customs Act, 1969.

(ii) in S. No. 21,-

following shall be inserted, namely:-

manufacturers of PV Modules registered under determination by the Input Output Co-efficient Organization (IOCO).‖; and

(b) in sub-serial 7(b), the following new sub-serial number in column (2) and the entries relating

252 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

added, namely:-

Input Output Co-efficient

Organization (IOCO).‖;

compound

nes under the Sales Tax Act, inverters

manufacturers of Lithium Batteries registered under Wires with tags)

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 253

Internal) 8536.2020 8536.2090

the entries relating thereto in columns (3), (4) and

(5) shall be substituted, namely:-

relevant information online machine). against a specific user ID under section 155D of the 1. The goods shall not be sold or otherwise disposed of without prior approval of the FBR and as prescribed by FBR.

preamble. headings and equipment.

254 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

ROBOT Visual Inspection Unloading Machine Degree Rotator Simulator Tester Machine Machine cell testers structures. hoods.

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 255

dryers nes. machines nes for removing metal. individual functions. machines and apparatus nes. protect electric circuits, not exceeding 1,000 volts. machinery and equipment. Machine manufacturing machinery and equipment. systems

256 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

components circulation thermal tester equipment 62133 tester UN 38.3 equipment equipment

(iii) in S. No. 23, in column (2) for sub-serial(iv), and the entries relating thereto in column (3) and (4), the following shall be substituted, namely:-

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 257

Board (MCPCB) Board (MCPCB)

(B) in Part-II, in Table C, after S. No. 40, the following new S. No. and the entries relating thereto in columns (2), (3) and (4), shall be added, namely:-

Extract Surfactant

(a) in the preamble, in serial (i),-

figure -35‖ shall be substituted and in sub- serial (c) for the expression -16 and 20‖, the expression -24 and 29‖ shall be substituted;

words -Ministry of National Food Security and Research‖ shall be substituted; and

(b) sub-serial (ii) shall be omitted.

(i) thereto in columns (2), (3), (4) and (5), the following shall be inserted, namely:-

Research.‖;

258 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(ii) Sr. Nos. 4, 6, 11,12,13 and 14 and the corresponding entries relating thereto in columns (2), (3), (4) and (5) shall be omitted.

(iii) in Sr.No.116, in column (2), -

(i) against sub-serial (xvi), in column (4), the figure -10‖, shall be inserted; and

(ii) sub-serial (xvii) and the entries in column (3), shall be omitted. (D) In Part-V(A), in Table-I, in column (1), against serial No. 7, in column (2), after words -wheelers‖, the expression -excluding vehicles of value exceeding US$ 50,000‖ shall be added; (E) in Part-VI, in the Preamble, for the existing conditions (i), (ii), (iii), (iv) and (v), the following conditions shall be substituted, namely:- -(i) The exemption shall be admissible to the Airline Companies having valid registration and license from the Aviation Division, Government of Pakistan duly shared with the Customs Computerized System or Pakistan Single Window to the effect that the intending importer is operating in the country or intends to operate in the country in the airline sector;

(ii) The Chief Executive, or the person next in hierarchy duly authorized by the Chief Executive or Head of the importing Company shall certify that the imported goods/items are the company’s bonafide requirement and shall be used for the purpose as defined/notified by the Aviation Division, Government of Pakistan under the Aviation Policy. The importer shall declare all relevant information to the Customs while claiming exemption regarding genuineness of the claim through Customs computerized system or Pakistan single window; and

(iii) In case of deviation from the above stipulations, the Collector of Customs shall initiate proceedings for recovery of duty and taxes under the relevant laws.

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 259

(i) in the Table-A, in column (1), for S.No.2, and the entries relating thereto in column (2), (3) and (4) the following shall be substituted; namely:-

and hatcheries

(ii) in the Table-B, in column (1), Sr. Nos. 11 and 13 and columns (2), (3), and (4) shall be omitted.

Allowances) Act, 1974.-that in the Members of Parliament (Salaries and Allowances) Act, 1974,-

(a) in section 5, in paragraph (c), for the words -at the rate of ten Rupees per kilometer‖ the words -at the rate of twenty-five Rupees per kilometer‖ shall be substituted;

(b) in section 6, in paragraph (c) for the words -at the rate of three Rupees per kilometer‖ the words -at the rate of twenty-five Rupees per kilometer‖ shall be substituted;

Explanation for the expression -twenty-five‖ the expression -thirty‖ shall be substituted; and section (5) and thereafter the following new sub-section (6) shall be added, namely: - -(6) the un-utilized air tickets and travel vouchers to which a Member is entitled under this section shall carry forward to next financial year and not lapse at the end of a financial year.‖; and

260 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(d) in section 14B, for the words -Federal Government‖ the words -Finance Committee of the National Assembly Secretariat‖ shall be substituted.

(e) in section 14C, for the words -Federal Government‖ the words -Finance Committee of the National Assembly Secretariat‖ shall be substituted.

6. Amendment of the Abandoned Properties (Management) Act, 1975 (XX of 1975)

In the Abandoned Properties (Management) Act, 1975 (XX of 1975), the following further amendments shall be made, namely:-

(1) in section 16, in sub-section (2), after omitted clause (k), the following new clause (l) shall be added, namely: - -(l) invest in any security approved by the Federal Government in the manner as may be prescribed.‖; and

(2) in section 29, sub-section (2) shall be omitted.

7. Amendments of the Sales Tax Act, 1990

In the Sales Tax Act, 1990, the following further amendments shall be made, namely:-

(1) in section 2,-

(a) for clause (3), the following shall be substituted, namely:- -(3) “associates or associated persons” shall have the same meaning as defined in section 85 of the Income Tax Ordinance, 2001(XLIX of 2001);‖;

(b) for clause (4), the following shall be substituted, namely:- -(4) -Board‖ shall have the same meaning as defined under clause (8) of section 2 of the Income Tax Ordinance, 2001 (XLIX of 2001);‖;

(c) in clause (14), in sub-clause (d), after the word -person‖, the expression -excluding those services as specified by the Board through notification in the official Gazette subject to such conditions, restrictions and limitations as mentioned therein‖ shall be inserted;

(d) after clause (15), the following new clause shall be inserted,

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 261

the Board to provide electronic invoicing system for integration of registered persons in the prescribed manner;

(e) for clause (37), the following shall be substituted, namely:- -(37) -tax fraud‖ means intentionally understating or underpaying the tax liability or overstating the entitlement to obligations imposed under this Act by way of submission of false return, statements or false documents or withholding of correct information or documents to cause loss of tax and includes- under this Act; any tax invoice, in violation of the provisions of this Act or the rules made thereunder; goods leading to inadmissible claim of input tax credit or refund; methods other than that covered under clauses (a) to (d); deposit the same in the prescribed manner beyond a period of three months from due date of payment of tax; substitution of financial records or production of fake accounts or documents or furnishing of any false information through human, mechanical or electronic means with an intention to evade tax due or claim inadmissible refund;

262 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

evidence or documents required to be maintained through human or digital means; other manner dealing with, any goods in respect of which there are reasons to believe that these are liable to confiscation under this Act or the rules made thereunder; registration under this Act; or omission to take any action to cause loss of tax under this Act. this clause shall be treated as intentional unless the person accused of tax fraud proves that he had no intention, motive, knowledge, or reason to believe that he was committing a tax fraud.‖;

(f) in clause (44), in sub-clause (a), after the word -supply‖, occurring at the end, the expression -or the time when any payment is received by the supplier in respect of that supply, whichever is earlier‖ shall be added; and

(g) in clause (46),- -federal‖ shall be substituted; and

(ii) after sub-clause (j), in the first proviso, after the word -goods‖, occurring for the first time, the expression -, shall be inserted.;

(2) in section 3, sub-section (11) shall be omitted;

(3) section 11 shall be omitted;

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 263

(4) for section 11B, the following shall be substituted, namely:- -11B. Limitation for issuing orders in certain cases.- For the purposes of issuing an assessment order or any other order in consequence of or to give effect to any order made by the Commissioner (Appeals), Appellate Tribunal, High Court, or Supreme Court, the provisions of section 124 of the Income Tax Ordinance, 2001 (XLIX of 2001) shall apply mutatis mutandis.‖;

(5) after section 11C, the following new sections shall be inserted, “11D. Best judgment Assessment. - (1) Where a person,-

(a) fails to furnish a sales tax return in response to notice under sub-section (2A) of section 26; or

(b) fails to produce before the officer of Inland Revenue not below the rank of Assistant Commissioner under sections 25 or 38A, accounts, documents and records required, or any other relevant document or evidence that may be required by him, the officer of Inland Revenue not below the rank of Assistant Commissioner may, after a notice to show cause to such person, based on any available information or material and to the best of his judgment, make an assessment of tax payable or refund due and also charge penalty and default surcharge.

(2) For the purposes of clause (b) of sub-section (1), the officer of Inland Revenue may also disallow or reduce a registered person input tax on goods if the registered person is unable, to provide invoice or other record or evidence of the transaction or circumstances giving rise to such claim.

(3) Where a best judgment assessment has been made due to default of clause (a) of sub-section (1) and the person files the return within sixty days of issuance of order under this section thereafter and pays the amount of tax payable along with default surcharge and penalty, the notice to show cause and the order of assessment shall abate.

(4) Notwithstanding anything in sub-section (1), where the Federal Board of Revenue has specified conditions for the purpose of determination of minimum tax liability in respect of a person who is required to file return but who fails to file such return, the Officer of Inland Revenue shall determine such liability of the registered person in accordance thereof.‖

264 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

8. Amendments of The Income Tax Ordinance, 2001 (XLIX of 2001)

In the Income Tax Ordinance, 2001 (XLIX of 2001), the following further amendments shall be made, namely:-

(1) in section 2,-

(a) in clause (8), after the word -thereof‖ the expression -and includes a Member of the Federal Board of Revenue to whom powers of the Board have been delegated under section 8 of the Federal Board of Revenue Act, 2007;‖ shall be inserted; and

(b) in clause (11B), after the word -includes a‖, the expression -Chief Investigator,‖ shall be inserted;

(2) after the omitted section 4A, the following new section shall be inserted, namely:- -(4AB) Subject to this Ordinance, a surcharge shall be payable by every individual and association of persons at the rate of ten percent of the income tax imposed under Division I of Part I of the First Schedule where the taxable income exceeds rupees ten million.‖;

(3) after section 7E, the following new section shall be inserted, namely: - -7F. Tax on builders and developers. - (1) A tax shall be imposed at the rate specified in Division I or II of Part-I of the First Schedule on the taxable profit of every person deriving income from the business of -

(a) construction and sale of residential, commercial or other buildings;

(b) development and sale of residential commercial or other plots; or

(2) For the purpose of this section, taxable profit shall be -

(a) ten percent of gross receipts in respect of activities specified in clause (a) of sub-section (1);

280 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(b) fifteen percent of gross receipts in respect of activities specified in clause (b) of sub-section (1); and

(c) twelve percent of gross receipts in respect of activities specified in clause (c) of sub-section (1). Explanation.- For the removal of doubt, it is clarified that the provisions of this section shall only apply in respect of income accruing from gross receipts from activities specified in sub-section (1) and shall not be applicable to income or incomes from any other source or under any head of income.

(3) Where a taxpayer, while explaining the nature and source of the amount credited or the investment made, money or valuable article owned or the funds from which the expenditure was made, takes into account any source of income which is subject to tax under this section, the taxpayer shall not be allowed to take credit of any sum as is in excess of taxable profit: Provided that where taxable income under section 9 is more than the taxable profit under this section, taxpayer shall be entitled to take credit of such taxable income subject to the payment of tax at the rate specified in Division I or II of Part- I of First Schedule.

(4) The provisions of this section shall not apply to a builder or developer established by an Act of the Parliament or a Provincial Assembly or by a Presidential Order and who is engaged in activities for the benefit of its employees or otherwise including activities for the planning and development of and for providing and regulating housing and ancillary facilities in a specified or notified area.‖;

(4) in section 37, in sub-section (6),-

(i) after the word -paid‖ occurring for the first time, the words -or payable‖ shall be inserted; and

(ii) after the word -shares‖, occurring for the second time, the expression -at the time of payment or at the time of registration of shares by the Securities and Exchange

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 281 Commission of Pakistan or by the State Bank of Pakistan, whichever is earlier‖ shall be inserted;

(5) in section 57, after sub-section (2B), the following new sub-section shall be inserted, namely:- -(2C) Where a loss, referred to in sub-section (2), relating to a tax year commencing on or after the first day of January, 2017 is sustained by Pakistan International Airlines Corporation Limited, the said loss shall be carried forward for a period of ten years.‖;

(6) in section 65F, in sub-section (1), -

(i) in clause (b), for the expression -; and‖, a full stop shall be substituted; and

(ii) after clause (b), amended as aforesaid, the following explanation shall be added, namely:- “Explanation.- For the removal of doubt it is clarified that tax credit under clause (a) shall only be available to the income derived from the operations of coal mining projects in Sindh supplying coal to power generation projects.‖;

(7) in section 92, in sub-section (1), in the first proviso, for the full stop at the end, a colon shall be substituted and thereafter the following new proviso shall be inserted, namely:- -Provided further that the share of a member of an association of persons having turnover of three hundred million rupees or above during the tax year or any of the preceding tax years shall not be exempt if financial statements duly audited by a firm of Chartered Accountants as defined under the Chartered Accountants Ordinance, 1961 (X of 1961), or a firm of Cost and Management Accountants as defined under the Cost and Management Accountants Act, 1966 (XIV of 1966) have not been filed along with return of income by the association of persons to whom he is a member:‖;

(8) in section 100BA, in sub-section (1), after the word -list‖, the expression -or persons appearing on the active taxpayers‘ list who have not filed return by the due date specified in section 118 or by the due date as extended under section 119 or 214A‖ shall be inserted;

282 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

sections (3A) and (3B) shall be added, namely:-

presence in Pakistan‖ of a non-resident.

person in Pakistan including provision of download of data or software in Pakistan, if the aggregate of amount as may be prescribed; and

activities or engaging in interaction through digital means with such number of users in Pakistan as may be prescribed, irrespective of whether or not-

activities is signed in Pakistan;

business in Pakistan; or

Provided that only so much of income as is attributable to the transactions or activities referred to in clause (a) or clause (b) shall be deemed to Pakistan.‖;

(10) in section 108, after sub-section (5), the following new sub-section shall be added, namely:-

-(6) Notwithstanding the provisions of sub-section (1), for the tax year 2024 and onwards, where any amount is claimed as deduction for the tax year or for any of the two preceding tax years on account of royalty paid or payable to an associate directly or invention, design or model, secret formula or process, copyright,

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 283 trademark, scientific or technical knowledge, franchise, license, intellectual property or other like property or right or contractual right and on a notice issued by the Commissioner, the taxpayer fails to furnish any explanation or evidence that no benefit has been conferred on the associate, twenty five percent of the total expenditure for the tax year in respect of sales promotion, advertisement and publicity shall be disallowed and allocated to the said associate.‖;

(11) in section 111, after sub-section (2), the following new sub-section shall be inserted, namely: - -(2A) For the purposes of clause (ii) of sub-section (2) of this section, the -year of discovery of foreign assets or expenditure or concealed income‖, shall mean the year in which the Commissioner has issued a notice requiring the person to explain the nature and source of such foreign assets, expenditure or concealed income.‖;

(12) in section 114B, -

(a) in sub-section (2), -

(i) in clause (b), the word -or‖ occurring at the end shall be omitted; and

(ii) in clause (c), for the full stop at the end, a semicolon and the word -or‖ shall be substituted and thereafter the following new clause shall be added, namely: - -(d) restriction on foreign travel from the country for a citizen of Pakistan, excluding persons holding National Identity Card for Overseas Pakistanis (NICOP), minors, students, persons proceeding abroad for Hajj or Umrah and such other classes of persons as notified by the Board.‖;

(13) in section 116, in sub-section (1), -

(a) for the word -assets and liabilities‖ wherever occurring, the words -assets including foreign assets and liabilities including foreign liabilities‖ shall be substituted;

(b) after clause (b), the following new explanation shall be inserted, namely: -

284 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I “Explanation.- For removal of doubt, it is clarified that assets of spouse shall only be included in the wealth statement of the person if the spouse is dependent; and

(14) in section 121, -

(a) in sub-section (1), after clause (ab), the following new clause shall be inserted, namely: - -(ac) furnish return of income in response to notice under sub-section (3) of section 117; or‖;

(b) after sub-section (1), the following new sub-section shall be inserted, namely: - -(1A) For the purposes of making a best judgment assessment under sub-section (1), the Commissioner may determine taxable income on the basis of sectoral benchmark ratios prescribed by the Board. Explanation.-The expression -sectoral benchmark ratios‖ means standard business sector ratios notified by the Board on the basis of comparative cases and includes financial ratios, production ratios, gross profit ratio, net profit ratio, recovery ratio, wastage ratio and such other ratios in respect of such sectors as may be prescribed.‖;

(15) in section 122A, in sub-section (1), the expression -other than the Commissioner (Appeals) if the value of the assessment or, as the case may be, refund of the tax does not exceed twenty million rupees,‖ shall be omitted;

(16) in section 126A, -

(a) in sub-section (1), -

(i) for the expression -Subject to other provisions of this Act,-‖, the expression -Notwithstanding anything contained in any other provision of this Ordinance,-‖ shall be substituted; and

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 285

(ii) after clause (b), the following explanation shall be added, namely: - “Explanation.- For the purposes of this section value of assessment of tax means the net increase in tax liability of a person as a result of order sought to be assailed and value of refund means net reduction in refund as a result of order sought to be assailed.‖;

(b) in sub-section (4), for the expression -and from the 16th day of June‖, the expression -or before the 31st day of December‖, shall be substituted and shall be deemed to have taken effect on and from 16th day of June, 2024; and

(c) in sub-section (5), for the expression -the 16th day of June, 2024‖, the expression -the date of transfer under sub-section (4).;

(17) in section 127, in sub-section (1), for the word -Any‖, occurring for the first time, the expression -Subject to section 126A, any‖ shall be substituted;

(18) in section 131, in sub-section (1), the expression -or Commissioner (Appeals)‖ shall be omitted;

(19) in section 133, -

(a) in sub-section (1), -

(i) for the word -Within‖, occurring for the first time, the expression -Subject to section 126A, within‖ shall be substituted;

(ii) in the proviso, after the words -Appellate Tribunal‖, the expression -or, as the case may be, the Commissioner (Appeals)‖ shall be inserted; and

(iii) after the full stop at the end, the following new explanation shall be added, namely: - “Explanation.- For the removal of doubt it is clarified that reference against order of the Commissioner (Appeals), communicated after the date of commencement of the Tax Laws (Amendment) Act, 2024 (V of 2024), shall lie before the High Court

286 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I notwithstanding the proceedings pending prior to the date of commencement of the said Act.‖;

(b) in sub-section (2), after the words -Appellate Tribunal‖, the expression -or, as the case may be, the Commissioner (Appeals)‖ shall be inserted;

(c) in sub-section (7), after the expression -Appellate Tribunal‘s order‖, the expression -or, as the case may be, the Commissioner (Appeals)‘s order‖ shall be inserted;

(d) in sub-section (10), after the expression -Appellate Tribunal‖, the expression -or, as the case may be, the Commissioner (Appeals)‖ shall be inserted; and

(e) in sub-section (12), after the expression -sub-section (1)‖, the expression -, by the aggrieved person other than the Commissioner,‖ shall be inserted;

(20) in section 147, -

(a) in sub-section (4), in the proviso, for the word -ten‖, the word -twenty‖ shall be substituted; and

(b) after sub-section (6A), the following new sub-sections shall be inserted, namely: - -(6B) Where an estimate of the amount of tax payable has been filed by the taxpayer under sub-section (6) as the case may be, the estimate shall contain turnover for the completed quarters of the relevant tax year, estimated turnover for the remaining quarters, supporting evidence of expenses or deductions in computing income, evidence of tax payments and tax credits and computation of estimated taxable income: Provided that where the Commissioner is not satisfied with the documentary evidence provided or where an estimate of the amount of tax payable is not accompanied by details mentioned in this sub-section, the Commissioner may reject the estimate after providing an opportunity of being heard to the taxpayer and the taxpayer shall pay advance tax according to the formula set out in sub-section (4) or sub- section (4B), as the case may be.

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 287

(6C) Notwithstanding anything contained in this Ordinance, the persons specified in sub-sections (1), (3), (3A), (3B) and (3C) of section 154 shall, at the time of realization of foreign exchange proceeds, or realization of the proceeds on account of sale of goods, or export of goods, or at the time of making payment to an indirect exporter, or clearing of goods exported, respectively, deduct or collect, as the case may be, advance income tax under this section at the rate of one percent of such foreign exchange proceeds, or export proceeds, or exports, or payment, in addition to tax collectable or deductible under section 154 of this Ordinance.‖;

(21) in section 148, -

(a) in sub-section (6), for the word -The‖ occurring for the first time, the expression -Subject to sub-section (6A), the‖ shall be substituted; and

(b) after sub-section (6), amended as aforesaid, the following new sub-section shall be inserted, namely: - -(6A) The Board may, by notification in the official Gazette, determine the minimum value of goods for the purpose of collection of advance tax under this section.‖; and

(i) in clause (a), after the semi colon, the word -and‖ shall be omitted;

(ii) in clause (b), for the words -all other goods‖ the expression -goods other than those specified in clauses

(a) and (c)‖ shall be substituted and for the full stop at the end, a semi colon and the word -and‖ shall be substituted; and

(iii) after clause (b), amended as aforesaid, the following new clause shall be added, namely:- -(c) minimum value as notified by the Board under sub-section (6A) as if such goods were subject to ad valorem duty as increased by the custom- duty, federal excise duty and sales tax, payable in respect of the import of the goods.‖;

288 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(22) in section 149, -

(a) in sub-section (1), after the word -made‖, the expression -including tax under section 4AB‖ shall be inserted; and

(b) in sub-section (2), in formula A/B, in component A, after the word -year‖, the expression -plus tax chargeable under section 4AB‖ shall be inserted;

(23) in section 152, in sub-section (4A), for the expression -without deduction of tax or deduction of tax at a reduced rate‖, the expression -after deduction of tax at a reduced rate but such reduction shall not exceed eighty percent of the rate specified in the said Division‖ shall be added;

(24) in section 153, for sub-section (4), the following shall be substituted, namely:- -(4) The Commissioner may, on application made by the recipient of a payment referred to in sub-section (1) and after making such inquiry as the Commissioner thinks fit, may allow in cases where tax deductible under sub-section (1) is not minimum, by an order in writing, any person to make the payment after deduction of tax at reduced rate but such reduction shall not exceed eighty percent of the rate specified in the said Division: Provided that the Commissioner shall issue reduced rate certificate within fifteen days of filing of application to a company if advance tax liability has been discharged: Provided further that the Commissioner shall be deemed to have issued the reduced rate certificate upon the expiry of fifteen days to the aforesaid company and the certificate shall be automatically processed and issued by Iris: Provided also that the Commissioner may modify or cancel the certificate issued automatically by Iris on the basis of reasons to be recorded in writing after providing an opportunity of being heard.‖;

(25) in section 154,-

(a) in sub-section (1) after the word -tax‖, the words -including advance tax‖ shall be inserted;

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 289

(b) in sub-section (4), for the word -final‖ the word -minimum‖ shall be substituted; and

(26) in section 168, in sub-section (3), clause (e) shall be omitted;

(27) in section 169, in sub-section (1), in clause (b), the expression -sub-section (4) of section 154,‖ shall be omitted;

(28) in section 182, in sub-section (1), in the Table, -

(a) after S. No. (1AAA), the following new S. No. and entries relating thereto in columns (2), (3) and (4) shall be inserted,

(a) 0.1% of the tax payable in section (3) of section 117 respect of that tax year for within the time specified in each day of default; or

(b) Rs. 1,000 per day of default:

Provided that minimum penalty shall be Rs.10,000 in case of an individual and Rs.50,000 in all other cases.

(b) after S. No. 3 and entries relating thereto in columns (2), (3) and (4), the following new S. No shall be inserted, namely: -

advance tax as specified in under section 99B.

be imposed effective from such date as the Board may notify.

290 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(d) after S. No. 12, the following new S. No and entries relating thereto in columns (2), (3) and (4) shall be inserted, -12A Where any person fails to pay tax Such person shall pay 37(6)‖ at the time of making payment as a penalty equal to consideration of shares or at the fifty percent of the time of registration of shares by amount of tax the Securities and Exchange involved Commission of Pakistan or the State Bank of Pakistan, whichever is earlier.

(e) after S. No. 34, the following new S. No and entries relating thereto in columns (2), (3) and (4) shall be inserted, -35 Any company and an association of Such company, including a 114(2) persons who - banking company and an association of persons shall pay a penalty of Rs.500,000

(a) fails to fully state all the relevant or 10% of the tax chargeable particulars or information as specified on the taxable income, in the form of return, including a whichever is higher.‖ declaration of the records kept by the taxpayer;

(b) furnishes any annexure, statement or document specified in the return of income as blank or with incomplete or irrelevant particulars; or

(c) attaches blank or incomplete annexures, statements or documents where such annexures, statements or records were required to be filed.

(29) in section 191, in sub-section (1), in clause (a), after the expression -section 114‖, the expression -, sub-section (3) of section 117‖ shall be inserted;

(30) after section 191, amended as aforesaid, the following new sections shall be inserted, namely:- -191A. Prosecution for failure to furnish information in return of income.- Any company including a banking company and an association of persons who -

(a) fails to fully state all the relevant particulars or information as specified in the form of return, including a declaration of the records kept by the taxpayer;

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 291

(b) furnishes blank or incomplete particulars or information as specified in the return of income; or

(c) attaches blank or incomplete annexures, statements or documents where such annexures, statements or records were required to be filed, shall commit an offence punishable on conviction with a fine or imprisonment for a term not exceeding one year or both.

9. Amendments of the Federal Excise Act, 2005

In the Federal Excise Act, 2005, the following further amendments shall be made, namely:-

(1) In section 2, for clause (4), the following shall be substituted,

clause (8) of section 2 of the Income Tax Ordinance, 2001 (XLIX of 2001).‖;

(2) in section 8, for the words -KIBOR plus three‖, the expression annum, whichever is higher‖, shall be substituted;

(3) in section 19,-

(a) in sub-section (3),-

omitted; and

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 305

(ii) in clause (e), after the expression -under;‖ the word -and‖ shall be added and thereafter the following new clause shall be added, namely:- -(f) where the value of the plant and machinery is rupees fifty million and above, installs such plant and machinery, commences production or removes such plant and machinery without prior permission of the Commissioner.‖; and

(b) after sub-section (10), the following new sub-section shall be inserted, namely:- -(10A) If any retailer is found selling cigarettes packs without affixing, or affixing counterfeited, tax stamps, banderoles, stickers, labels or barcodes, notwithstanding any other provision of this Act, the retail outlet of such person shall be liable to be sealed in the manner as may be prescribed.‖; and

(4) after section 29, the following new section shall be inserted, -29A. Tax Fraud Investigation Wing Inland Revenue.- (1) There shall be established a wing to be known as Tax Fraud Investigation Wing Inland Revenue.

(2) The functions of the tax fraud Investigation Wing Inland Revenue shall be to detect, analyze, investigate, combat and prevent tax fraud.

(3) The tax fraud Investigation Wing Inland Revenue shall comprise Fraud Intelligence and Analysis Unit, Fraud Investigation Unit, Legal Unit, Accountants Unit, Digital Forensic and Scene of Crime Unit, Administrative Unit or any other Unit as may be notified by the Board by notification in the official Gazette.

(4) The tax fraud Investigation Wing Inland Revenue shall consist of a Chief Investigator and as many following officers, as may be notified by the Board, namely:-

(a) Senior Investigators, Investigators, Junior Investigators or any other officer of Inland Revenue with any other designation;

306 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(b) a Senior Forensic Analyst and as many Forensic Analysts and Junior Forensic Analysts; and

(a) specify the functions and jurisdiction of the Tax Fraud Investigation Wing Inland Revenue and its Units and officers; and

section 29 upon the Tax Fraud Investigation Wing Inland Revenue and its officers under clause (a) of sub-section 4.

authorities appointed under section 29 or any other authority or prosecution under Chapter III of the Act.‖;

-assessment‖, the words -of tax‖ shall be inserted;

-16th day of June, 2024‖, the expression -31st day of December, 2024‖ shall be substituted and shall be deemed to have taken effect from the 16th day of June, 2024.‖;

be inserted, namely:-

section (1) of section 34 and sub-section (1) of section 34A shall continue to apply where any decision of the Commissioner (Appeals) commencement of the Tax Laws (Amendment) Act, 2024 (V of 2024).

(8) in the First Schedule, in Table-I, in column (1).-

inserted, namely:-

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 307 -7a. Acetate Respective Rupees forty four tow heading thousand per kg.‖;

(ii) in S. No. 8a, in column (4), after the words -per kg‖, the words -or sixty five percent of retail price whichever is higher‖ shall be added;

(iii) after S. No. 8c, the following new S. No. and entries relating thereto in columns (2), (3) and (4) shall be inserted, namely:- -8d. Nicotine Respective Rupees one pouches heading thousand and two hundred per kg.‖;

(iv) against S. No. 9, in column (2), for the words -nine thousand ‖, the words -twelve thousand five hundred‖ shall be substituted;

(v) against S. No. 10, in column (2), for the words -nine thousand ‖, the words -twelve thousand five hundred‖ shall be substituted;

(vi) against S. No.13, in column (4), for the word -two‖, the word -four‖ shall be substituted;

(vii) against S. No. 56, in column (4), for the words -fifteen hundred‖, the words -eighty thousand‖ shall be substituted; and -(viii) after S. No. 62, the following new S. No. and entries relating thereto in columns (2), (3) and (4) shall be added, namely:- -63. Lubricating oil 2710.1951, Five percent 2710.1952 and ad 2710.1953 valorem.‖.

(9) in the First Schedule,- (A) after the Table-I,-

(a) for the marginal heading, -(2) Variants at different price points‖, the expression -Restriction-2 - Brand variants at different price points‖ shall be substituted and thereafter for the full stop at the end, the following Explanation shall be added, namely:-

308 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

-Explanation.- For the purpose of this restriction, brand variant means any cigarette brand with similar distinguishing mark associated with an existing brand family.‖;

-sixty‖, the expression -fifty-five‖ shall be substituted‖;

(B) in Table-II, in column (1), against S. No. 3, in column (2), for clause (b) and entries relating thereto in columns (2), (3) and (4), the following shall be substituted, namely:-

of travel by air of passengers embarking on international journey from Pakistan, - day of July, 2024.

(b) IATA Traffic Conference Area 2

Pacific Islands)

-TABLE-III

(EXCISABLE ITEMS OTHER THAN THOSE MENTIONED UNDER TABLE-I AND TABLE-II)’

[See clause (e) of sub-section (1) of section 3]

Number

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 309

Number

(ii) 5% of gross amount of consideration involved where the buyer has not filed the date as specified in proviso to Rule 1A of Tenth Schedule Ordinance, 2001; and

(iii) 7% of gross amount of consideration involved where the buyer is not appearing on Ordinance, 2001 on the date of acquisition of property.

processing or packaging entity.‖.

(10) in the Third Schedule, in Table-I, in column (1), after S. No. 22, the following new S. No. and entries relating thereto in columns

(2) and (3) shall be added, namely:-

various Acts, Orders, Rules, Regulations and Agreements Government of Pakistan.

10. Amendments of The Federal Board of Revenue Act, 2007 (IV of 2007)

In the Federal Board of Revenue Act, 2007 (IV of 2007), in section 8, after the word -Member‖, the words -or employee‖ shall be omitted.

11. Amendment of the Public Finance Management Act, 2019

In the Public Finance Management Act, 2019, in section 2, for clause (w) the following shall be substituted, namely:-

authorization, as the case may be, of additional funds to a demand for grant against-

Entities in Federal Consolidated Fund for a specific purpose; or

310 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(iv) unbudgeted foreign grants received or deposited by foreign governments or international donors in Federal Consolidated Fund for a specific purpose.‖; and

11E. Assessment of tax and recovery of tax not levied or short levied or erroneously refunded

(1) Where due to any reason, including by way of collusion or a deliberate act, any tax or charge has not been levied or short levied or where the officer of Inland Revenue not below the rank of Assistant Commissioner suspects on the basis of audit or otherwise that due to any reason a person has-

(a) not paid or short paid due sales tax;

(b) claimed input tax credit or refund which is not admissible; or

(c) has obtained an amount of refund not due, the officer of Inland Revenue after issuing a show cause notice to the person shall pass an order to determine and recover the amount of tax unpaid or short paid, inadmissible input tax or refund, or unlawful refund obtained and shall also impose penalty and default surcharge in accordance with sections 33 and 34.

(2) For the purposes of sub-section (1), the officer of Inland Revenue may also disallow input tax on goods or services if the taxpayer is unable, without reasonable cause, to provide a receipt, or invoice or other record or evidence of the transaction or circumstances giving rise to such claim.

(3) Where a tax or charge has not been levied under clause

(a) of sub-section (1), the amount of tax shall be recovered as tax fraction of the value of supply.

11F. Failure to withhold sales tax

Where any person, required to withhold sales tax under sub-section (7) of section 3, fails to withhold the tax or having withheld the tax fails to deposit the same in the prescribed manner, the officer of Inland Revenue not below the rank of Assistant Commissioner shall after a notice to such person to show cause pass an order to determine and recover the amount in default and impose penalty and default surcharge under section 33 and 34.

11G. Limitation for assessment

(1) The show cause notice under sections 11D to 11F shall be issued within five years, from the end of the financial year in which the relevant date falls.

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 265

(2) An order under sections 11D, 11E and 11F shall be made within one hundred and twenty days of issuance of show cause notice or within such extended period as the Commissioner may, for reasons to be recorded, in writing specify, provided that such extended period shall in no case exceed from ninety days: Provided that any period during which the proceedings are adjourned on account of a stay order or Alternative Dispute Resolution proceedings or the time taken through adjournment by the registered person not exceeding sixty days shall be excluded from the computation of the period specified in this sub-section.

(3) For the purpose of sections 11D, 11E and 11F, the words -relevant date‖ means-

(a) the time of payment of sales tax or charge as provided under section 6;

(b) the time of payment for goods or services on which sales tax was to be withheld under sub- section (7) of section 3; and

(6) in section 21,-

(a) in sub-section (2), for the word -blacklist‖, the words -issue an order of suspension and blacklisting‖ shall be substituted; and

(b) after sub-section (4), the following new sub-section shall be added, namely:- -(5) Notwithstanding anything contained in this Act, the Chief Commissioner may, either of his own motion or on application made by the registered person call for and examine the record of proceedings and the order of suspension and blacklisting under sub-section (2) and after making such inquiry as is necessary, may modify the such order as he may deems fit: Provided that no order under this sub-section shall be passed unless an opportunity of being heard has been provided to the registered person.‖;

266 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(7) in section 23, for sub-section (3), the following shall be substituted, subject to such conditions, restrictions and limitations as the Board electronic invoices.‖;

(8) for section 25, the following shall be substituted, namely:- “25. Audit of sales tax affairs.-(1) The Commissioner on the basis of reasons to be recorded in writing, may direct the Commissioner to conduct audit of sales tax affairs of any registered person and issue a notice to such registered person intimating him regarding audit of sales tax affairs. Explanation.-For the removal of doubt, it is declared that the powers of the Commissioner to direct conduct of audit and to issue a notice under this sub-section are independent of the powers of the Board under section 72B and nothing contained in section 72B restricts the powers of the Commissioner to direct conduct of audit and to issue notice under this sub-section. referred to in sub-section (1) to the registered person whose audit is to be conducted through the notice under sub-section (1). Explanation.-For the removal of doubt, it is declared that the Commissioner may not provide an opportunity of hearing before issuance of notice under sub-section (1). on scrutiny of the available records including sales tax and federal financial statements or third party information: verification of input tax, output tax, refund claim and compliance of legal provisions without identifying risk factors that require such verification. (1), the officer of Inland Revenue, may call for any record or documents including record maintained under this Act, the rules made thereunder or any other law for the time being in force for conducting audit of the sales tax affairs of the person. Where such

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 267 registered person shall allow authorize officer of Inland Revenue access to the use of machine and software on which such data is kept and the officer of Inland Revenue may obtain duly attested hard copies of such information or data from the registered person: Provided that the officer of Inland Revenue shall not call for record or documents of the registered person after expiry of six years from the end of the financial year to which they relate.

(5) The officer of Inland Revenue may require the registered person to attend his office in person or through an authorized representative. The registered person shall produce such accounts, documents or any evidence as the officer of Inland Revenue may consider necessary.

(6) The officer of Inland Revenue not below the rank of Assistant Commissioner may conduct or cause to be conducted such enquiry and obtain such information from any third party as he considers appropriate.

(7) The officer of Inland Revenue not below the rank of Assistant Commissioner shall conduct audit of the sales tax affairs to verify the correctness or otherwise of the declared tax liability, output tax, input tax claimed, tax paid, refund claimed, stocks consumed or available for ascertaining compliance or otherwise with the provisions of this Act and the rules made thereunder on the basis of the record and evidence obtained under sub-sections (5) or (6).

(8) The officer of Inland Revenue may conduct audit proceedings electronically through video links, or any other facility as may be prescribed by the Board.

(9) After completion of the audit, the officer of Inland Revenue may, if required pass an order under section 11E, after providing an opportunity of being heard to the registered person under sub-section (1) of section 11E.

(10) Notwithstanding anything contained in sub-sections (7) and (9) where a registered person fails to produce before the officer of Inland Revenue, any accounts, documents or records required to be maintained under this Act or the rules made thereunder or any other relevant document electronically kept record, electronic machine or any other evidence that may be required by the officer of Inland Revenue for the purpose of audit. The officer of Inland Revenue may proceed to make best judgment assessment under section 11D of this Act.

(11) Notwithstanding the penalties prescribed in section 33, if a registered person wishes to deposit the amount of tax short paid

268 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I or amount of tax evaded along with default surcharge voluntarily, whenever it comes to his notice, before receipt of notice of audit, no penalty shall be recovered from him: Provided that if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with default surcharge during the audit, or at any time before issuance of show cause notice under section 11E, he may deposit the evaded amount of tax, default surcharge under section 34, and twenty five percent of the penalty payable under section 33: Provided further that if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with default surcharge after issuance of show cause notice under section 11E, he shall deposit the evaded amount of tax, default surcharge under section 34, and full amount of the penalty payable under section 33 and thereafter, the show cause notice, shall stand abated.‖;

(9) In section 26, after omitted sub-section (2), the following new sub- section (2A) shall be inserted, namely:- -(2A) The officer of Inland Revenue may, by notice in writing, require any person who, in his opinion, is required to file a return under this section for a tax period or tax periods but who has failed to do so, to furnish the return or returns within fifteen days from the date of service of such notice or such longer or shorter period as may be specified in such notice or as the officer of Inland Revenue may allow: Provided that the notice under this sub-section shall only be issued within fifteen years from the end of the financial year in which the return was to be filed, in cases of tax fraud and five years in all other cases.‖;

(10) 30AB. Tax Fraud Investigation Wing Inland Revenue.-(1) There shall be established a wing to be known as Tax Fraud Investigation Wing-Inland Revenue.

(2) The functions of the tax fraud Investigation Wing Inland Revenue shall be to detect, analyze, investigate, combat and prevent tax fraud.

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 269

(4) The tax fraud Investigation Wing Inland Revenue shall consist of a Chief Investigator and as many following officers, as may be notified by the Board-

(a) Senior investigators, investigators, Junior investigators or any other officer of Inland Revenue with any other designation;

(b) a Senior Forensic Analyst and as many Forensic Analysts and Junior Forensic Analysts; and

(5) The Board may, by notification in the official Gazette, -

(a) specify the functions and jurisdiction of the Tax Fraud Investigation Wing Inland Revenue and its Units and its officers; and

(b) confer the powers of authorities specified in section 30 upon the tax fraud Investigation Wing Inland Revenue and its officers at clause (a) of sub-section 4.

(6) Nothing contained in this section shall prevent the authorities appointed under section 30 or any other authority or officer conferred with the power and functions of authorities appointed under section 30 from conducting investigation and prosecution proceedings under Chapter-VII of the Act.

(11) in section 33, in the TABLE, in column (1),-

(a) against S. No. 11, in column (2), the following shall be substituted, namely:- -(11) Such person shall pay a penalty of twenty-five thousand rupees or one hundred per cent of the amount of tax evaded or sought to be evaded, whichever is higher. Without prejudice to the above, he shall also be liable, upon conviction by a Special Judge to imprisonment for a term which may extend to five years if the tax evaded or sought to be evaded is less than one billion, and which may extend to ten years if the tax evaded or sought to be evaded is one billion and above and fine which may extend to an amount equal to the

270 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I amount of tax evaded or sought to be evaded, or with both.‖;

(b) against S. No. 12, in column (2),-

(i) for the words -He shall, further be liable“, the words -Without prejudice to above, he shall also be liable,“ shall be substituted; and

(ii) for the words -which may extend to an amount equal to the amount of tax involved“, the words -which may extend to an amount equal to the amount of tax evaded or sought to be evaded“ shall be substituted;

(c) against S. No. 13, in column (2), the following shall be substituted, namely:- -(a) The person who commits, causes to commit or attempts to commit the tax fraud shall pay a penalty of twenty-five thousand rupees or one hundred percent of the amount of tax evaded or sought to be evaded, whichever is higher. Without prejudice to the above, he shall also be liable, upon conviction by a Special Judge to imprisonment for a term which may extend to five years if the tax evaded or sought to be evaded is less than one billion rupees, and which may extend to ten years if the tax evaded or sought to be evaded is one billion rupees and above, and fine which may extend to an amount equal to the amount of tax evaded or sought to be evaded, or with both; and

(b) The person who abets or connives in commissioning of tax fraud shall be liable, upon conviction by a Special Judge to imprisonment for a term which may extend to five years if the tax evaded or sought to be evaded is less than one billion rupees, and which may extend to ten years if the tax evaded or sought to be evaded is one billion rupees and above, and with fine which may extend to an amount equal to the amount of tax evaded or sought to be evaded or with both.‖;

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 271

(d) against S. No. 14, in column (2),-

(i) for the words -He shall, further be liable“, the words -Without prejudice to above, he shall also be liable,“ shall be substituted; and

(ii) for the words -“which may extend to an amount equal to the amount of tax involved”, the words -which may extend to an amount equal to the amount of tax evaded or sought to be evaded“ shall be substituted;

(e) against S. No. 18, in column (2), for the words -“which may extend to an amount equal to the amount of tax involved”, the words -which may extend to an amount equal to the amount of tax evaded or sought to be evaded“ shall be substituted;

(f) against S. No. 22, in column (2),-

(i) for the words -He shall, further be liable‖, the words -Without prejudice to above, he shall also be liable,‖ shall be substituted; and

(ii) for the words -which may extend to an amount equal to the amount of tax involved‖, the words -which may extend to an amount equal to the amount of tax evaded or sought to be evaded‖ shall be substituted;

(g) against S. No. 23, in column (2),-

(i) in clause (i),-

(a) after the word -confiscation‖, the words -as may be prescribed‖ shall be inserted;

(b) for the words -He shall, further be liable‖, the words -Without prejudice to above, he shall also be liable,‖ shall be substituted; and

(c) for the words -“which may extend to an amount equal to the amount of tax involved‖, the words -which may extend to an amount equal to the amount of tax evaded or sought to be evaded‖ shall be substituted.‖;

272 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

-shall be liable to be sealed by an officer of Inland Revenue in the manner as may be prescribed.‖ shall be added;

(h) against S. No. 24, in column (2),-

words -Without prejudice to above, he shall also be liable,‖ shall be substituted; and

equal to the amount of tax involved“, the words amount of tax evaded or sought to be evaded“ shall be substituted;

(i) against S. No. 25, in column (2), for the words -shall be sealed till such time he integrates his business in the -shall be liable to be sealed by an officer of Inland Revenue in the manner as may be prescribed.‖ shall be added;

(j) against S. No. 25A,-

the expression -or sub-section (4) of section 40C,‖ shall be inserted;

expression -and sub-section (4) of section 40C‖ shall be added; and

(k) after S. No. 25A and entries relating thereto in columns

(2) and (3), the following new S. No. shall be added,

as required under this Act and rules made thereunder.

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 273

(l) against S. No. 26, in column (2), after the word -confiscation‖, occurring for the first time, the words -as may be prescribed‖ shall be inserted; and

(m) against S. No. 27, in column (2), after the word -confiscation‖, occurring for the first time, the words -as may be prescribed‖ shall be inserted;

(12) in section 34, in sub-section (1), in clause (a), for the words -KIBOR plus three‖, the expression -twelve percent per annum or KIBOR plus three percent per annum, whichever is higher‖, shall be substituted;

(13) in section 37A, in sub-section (4), for the words -pays the amount of tax due along with such default surcharge and penalty as is determined under the provisions of this Act‖, the words -pays the amount of tax evaded or sought to be evaded along with default surcharge and penalty as provided under this Act“ shall be substituted;

(14) in section 40C, after sub-section (3), the following new sub- sections shall be added, namely:- -(4) Notwithstanding anything contained in this Act, the Board through notification in the official Gazette, may require any person or class of persons to integrate their electronic invoicing system with the Board‘s Computerized System for real time reporting of sales in such mode and manner and from such date as may be specified therein; and

(5) Licensed integrator shall integrate electronic invoicing system of registered persons referred to in sub-section (4) in such mode and manner as may be prescribed.‖;

(15) in section 43A, in sub-section (4), for the expression -16th day of June, 2024‖, the expression -31st day of December, 2024‖ shall be substituted and shall be deemed to have taken effect from the 16th day of June, 2024.‖;

(16) in section 45B, in sub-section (1), after the word -assessment‖, the words -of tax‖ shall be inserted;

(17) in section 46, in sub-section (1), after the word -order‖, occurring for the first time, the expression -, excluding the order of suspension or blacklisting under sub-section (2) of section 21,‖ shall be inserted;

274 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(18) after section 47A, the following new section 47AB shall be inserted, namely:-

(c) of sub-section (1) of section 46 and sub-section (1) of section commissioner (Appeals) or the Appellate Tribunal is received (Amendment) Act, 2024 (V of 2024).‖.

(19) in section 73, in sub-section (1), after the word -rupees‖ the words -in aggregate to a single supplier in a tax period‖ shall be inserted;

(19) In the Third Schedule, in column (1), after serial No. 50, the columns (2) and (3) shall be added, namely:-

(21) in the Fifth Schedule, in column (1), clauses (xvii), (xx), (xxi), (xxii), (xxiv), (xxv), (xxvi) and (xxvii) of serial number 12 shall be omitted and serial numbers 16, 17 and 21 and entries relating thereto in column (2) shall be omitted;

(22) In the Sixth Schedule,-

(A) in Table-I, in column (1), -

120, 169, 170 and 174 and entries relating thereto in columns (2) and (3) shall be omitted; and

2025‖ shall be substituted; and

(b) in the first proviso,-

substituted; and

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 275

shall be inserted;

(iii) against serial number 152, in column (2), for the expression -30th June, 2024‖ the expression -30th June, 2025‖ shall be substituted; and

(iv) after omitted Serial No. 174, the following new columns (2) and (3) shall be added, namely:-

of a natural disaster or other catastrophe, as gifts and relief consignments or any goods received as gift or donation from a foreign government or organization by the Federal or Provincial Governments or any public sector organization. Subject to the recommendations of the Minister Incharge and concurrence by the condition that the concerned Ministry shall verify the genuineness of such cases and furnish an undertaking to the effect that donated goods shall not be sold, utilized or disposed of otherwise than for the purpose for which the same have been imported. 2710.1931, 2710.1911 and 2710.1921 trientine capsules (for personal use only)

(B) in Table-II, in column (1),-

(i) Serial Nos. 7 and 21 and entries relating thereto in columns (2) and (3) shall be omitted; and

276 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(ii) after Serial No. 55 and entries relating thereto in columns (2) and (3), the following new Serial Nos. shall be added, namely:- -56. Milk excluding: 04.01

(i) that sold under a brand name; or

(ii) supplied by corporate dairy farms 57. Iron and steel scrap excluding supplied 7204.4100, by manufacturer-cum-exporter of 7204.3000, recycled copper, authorized under 7204.4990.‖. Export Facilitation Scheme, 2021.

(23) In the Eighth Schedule, in Table-I, in column (1),-

(i) Serial numbers 58 and 66 and entries relating thereto in columns (2), (3), (4) and (5) shall be omitted.;

(ii) against serial number 73, in column (2), after the word -vehicle‖, the expression -till 30th June, 2026‖ shall be inserted;

(iii) for S. No. 77, the following shall be substituted, namely:- -77. Imported personal computers and 8471.3020 and 10% Laptop computers, notebooks whether 8471.3010 or not incorporating multimedia kit

(iv) in S. No. 81, in column (2), after the expression -(XXXI of 1976)‖, the following shall be omitted, namely:- -and medicaments as are classifiable under chapter 30 of the First Schedule to the Customs Act, 1969 (IV of 1969) except the following, even if medicated or medicinal in nature, namely:- (a) filled infusion solution bags imported with or without infusion given sets; (b) scrubs, detergents and washing preparations; (c) soft soap or no soap; (d) adhesive plaster; (e) surgical tapes; (f) liquid paraffin; (g) disinfectants; and (h) cosmetics and toilet preparations. This substitution shall be deemed to have been made from the 1st day of July, 2022.‖ ;

(v) after S. No. 83, the following new S. Nos. and entries relating thereto in columns (2), (3), (4) and (5) shall be added, namely:-

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 277

4016.9290 or mathematical calculating instruments (geometry box) and porous tipped pens pencils 8701.9320 falling in the category of Tier-1 retailers.

(24) in the Ninth Schedule,-

(a) for Table-II, the following shall be substituted, namely:-

-Table-II

Cellular mobile phones in CKD/CBU form:

CBU condition in addition to tax under column (4) charged on the basis of equivalent value in rupees in case of supply by the manufacturer, at the rate as category:- valorem valorem

278 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

PROCEDURE AND CONDITIONS, clauses (iii), (iv) and (v) shall be omitted;

(25) In the Eleventh Schedule, in the TABLE, in column (1),-

the expression -80%‖ shall be substituted;

relating thereto in columns (2), (3) and (4) shall be added,

limestone flux under chapter 25 2520.1020, 2521.0000) 2704.0020, 2704.0090) (Respective headings) headings)

Sales Tax Act, 1990 to another registered person with the exception of supplies referred to in S. Nos. 5, 7, 9, 10, 11, 12 and 13 of the Table.‖; and

Procedure and conditions, in clause (2), in sub-clause (iv), after the word -phones‖, the expression -(PCT headings 8517.1419, 8517.1430 and 8517.1390)‖ shall be added.

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 279

12. Amendments of the Finance Act, 2022 (XIII of 2022)

In the Finance Act, 2022 (XIII of 2022), in section 8,-

(1) in sub-section (1), in the proviso, for the full stop at the end a colon shall be substituted and thereafter the following new proviso shall be added, namely: -Provided further that the capital value tax on a farmhouse and a residential house, within the territorial limits of the Islamabad Capital Territory, shall be levied, charged, collected and paid on the basis of the area of the farmhouse and residential house, irrespective of their value.‖;

(2) in sub-section (2), after clause (a), the following new clause shall be inserted, namely:- -(ab) farmhouses as defined in clause (b) of sub-section (4) of section 7E of the Income Tax Ordinance, 2001 (XLIX of 2001) within the territorial limits of the Islamabad Capital Territory; and

(ac) residential houses within the territorial limits of the Islamabad Capital Territory;‖;

(3) in sub-section (4), in clause (g), for the expression -(b)‖, the expression -(ab), (ac) and (b)‖ shall be substituted; and

(4) in the First Schedule, for the TABLE, the following shall be substituted, namely:- -TABLE S. No. Assets Description Rate

(1) (2) (3) 1 Motor vehicle mentioned in 1% of the value clause (a) of sub-section (1) 2 Assets mentioned in clause (ab) 500,000 rupees, for the of sub-section (1) farmhouse with an area between 2,000 square yards and 4,000 square yards and 1,000,000 rupees if the area exceeds 4,000 square yards

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 311 3 Assets mentioned in clause (ac) 1,000,000 rupees, for the of sub-section (1) residential house with an area between 1,000 square yards to 2,000 square yards, and 1,500,000 rupees if the area exceeds 2,000 square yards 4 Assets mentioned in clause (b) 1% of the value of sub-section (1) 5 Assets mentioned in clause (c) of As specified by the Federal sub-section (1) Government not exceeding 5% of the value.‖. TAHIR HUSSAIN, Secretary General. PRINTED BY THE MANAGER, PRINTING CORPORATION OF PAKISTAN PRESS, ISLAMABAD. PUBLISHED BY THE DEPUTY CONTROLLER, STATIONERY AND FORMS, UNIVERSITY ROAD, KARACHI.

191B. Prosecution for non-registration

Any person specified in section 99B who is required to apply for registration but fails to do so shall commit an offence punishable on conviction with imprisonment for a term not exceeding six months or fine or both.‖;

(31) in section 205, in sub-section (1), for the expression -12 percent per annum‖, wherever occurring, the expression -twelve percent or KIBOR plus three percent per annum, whichever is higher‖, shall be substituted;

(32) in section 216, in sub-section (3), after the omitted clause (kb), the following new clause shall be added, namely: - -(kc) to National Database and Registration Authority to process and analyze such data for the purposes of broadening of tax base;‖;

(33) after section 230J, the following new section shall be inserted, namely: - -230K. Tax Fraud Investigation Wing Inland Revenue. -

(1) There shall be established a wing to be known as Tax Fraud Investigation Wing Inland Revenue.

(2) The functions of the Tax Fraud Investigation Wing Inland Revenue shall be to detect, analyze, investigate, combat and prevent tax evasion and fraud.

(3) The Tax Fraud Investigation Wing Inland Revenue shall comprise Fraud Intelligence and Analysis Unit, Fraud Investigation Unit, Legal Unit, Accountants Unit, Digital Forensic and Scene of Crime Unit, Administrative Unit or any other Unit as may be approved by the Board or the Federal Government.

292 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(4) The Tax Fraud Investigation Wing Inland Revenue shall consist of a Chief Investigator and as many following officers, as may be notified by the Board -

(a) Senior Investigators, Investigators, Junior Investigators or any other officer of Inland Revenue with any other designation;

(b) a Senior Forensic Analyst and as many Forensic Analysts and Junior Forensic Analysts; and

(5) The Board may, by notification in the official Gazette,-

(a) specify the functions and jurisdiction of the Tax Fraud Investigation Wing Inland Revenue and its officers; and

(b) confer the powers of authorities specified in section 207 upon the Tax Fraud Investigation Wing Inland Revenue and its officers in clause (a) of sub-section 4.

(6) Nothing contained in this section shall prevent the authorities appointed under sections 207 and 208 or any other authority or officer conferred with the power of authorities under sections 207 and 208 from conducting prosecution Part XI of Chapter X of the Ordinance.‖

(34) in section 236C, in sub-section (1), in the proviso, -

(a) after the expression -Provincial Government‖ occurring for the first time, the expression -or a war wounded person while in service of Pakistan Armed Forces or Federal or Provincial Government or an ex-serviceman and serving personnel of armed forces or ex-employees or serving personnel of Federal and Provincial Government‖ shall be inserted; and

(b) after the expression -who dies in service‖, the expression -or a war wounded person while in service of Pakistan Armed Forces or Federal or Provincial Government or an ex- serviceman and serving personnel of armed forces or ex- employees or serving personnel of Federal and Provincial Government‖;

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 293

auto-parts, tyres, varnishes, chemicals, cosmetics, IT equipment, motorcycles, pesticides, cigarettes, glass, textile, beverages, paint or foam sector,‖ shall be omitted;

auto-parts, tyres, varnishes, chemicals, cosmetics, IT equipment, electronics, sugar, cement, iron and steel products, motorcycles, sector,‖ shall be omitted;

section shall be added, namely:-

-(18) The period of limitation provided in clause (d) of sub- section (2) of section 131 and sub-section (1) of section 133 shall (Appeals) or the Appellate Tribunal is received prior to the date of commencement of the Tax Laws (Amendment) Act, 2024.‖;

(38) in the First Schedule,-

(1) in Division I, -

(a) in paragraph (1), for the Table, the following shall be substituted, namely: -

-TABLE

Rs. 600,000/- 1,200,000 amount exceeding Rs. 1,200,000 but does not exceed Rs. amount exceeding Rs. 1,600,000 but does not exceed Rs.

294 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I S. No. Taxable Income Rate of Tax

(1) (2) (3) 5. Where taxable income exceeds Rs. 650,000 + 40% of the Rs. 3,200,000 but does not exceed Rs. amount exceeding 5,600,000 Rs. 3,200,000 6. Where taxable income exceeds Rs. Rs. 1,610,000 + 45% of the 5,600,000 amount exceeding Rs. 5,600,000: Provided that in the case of an association of persons that is a professional firm prohibited from incorporating by any law or the rules of the body regulating their profession, the 45% rate of tax mentioned against serial number 6 of the Table shall be 40%.‖; and

(b) in paragraph (2), for the Table, the following shall be substituted, namely: -TABLE S. No. Taxable Income Rate of Tax

(1) (2) (3) 1. Where taxable income does not 0% exceed Rs. 600,000/- 2. Where taxable income exceeds 5% of the amount exceeding Rs. 600,000 but does not exceed Rs. Rs. 600,000 1,200,000 3. Where taxable income exceeds Rs. 30,000 + 15% of the Rs. 1,200,000 but does not exceed amount exceeding Rs. 2,200,000 Rs. 1,200,000 4. Where taxable income exceeds Rs. 180,000 + 25% of the Rs. 2,200,000 but does not exceed amount exceeding Rs. 3,200,000 Rs. 2,200,000 5. Where taxable income exceeds Rs. 430,000 + 30% of the Rs. 3,200,000 but does not exceed amount exceeding Rs. 4,100,000 Rs. 3,200,000 6. Where taxable income exceeds Rs. Rs. 700,000 + 35% of the 4,100,000 amount exceeding Rs. 4,100,000‖;

(2) in Division III, for clause (b), the following shall be substituted, namely:- -(b) 15% in the case of mutual funds, Real Estate Investment Trusts and cases other than those mentioned in clauses (a), (c) and (d):

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 295 Provided that the rate of tax on dividend received from mutual funds deriving fifty percent or more income from profit on debt shall be 25%.‖;

(3) For the Division VII, the following shall be substituted, namely:- -DIVISION VII Capital Gains on Disposal of Securities The rate of tax to be paid under section 37A shall be as follows: - TABLE S. Holding Period Rate of Tax on disposal Rate of Tax on No. of securities acquired disposal of securities between 1st day of July, acquired on or after 1st 2022 and 30th June, day of July, 2024 2024 (both dates inclusive)

(1) (2) (3) (4) 1. Where the holding period 15% 15% for persons does not exceed one year appearing on the Active Taxpayers’ List on the 2. Where the holding period 12.5% date of acquisition and exceeds one year but does the date of disposal of not exceed two years securities and at the 3. Where the holding period 10% rate specified in Division exceeds two years but does I for individuals and not exceed three years association of persons 4. Where the holding period 7.5% and Division II for exceeds three years but companies in respect of does not exceed four years persons not appearing 5. Where the holding period 5% on the Active exceeds four years but does Taxpayers’ List on the not exceed five years date of acquisition and 6. Where the holding period 2.5% date of disposal of exceeds five years but does securities: not exceed six years Provided that the rate of 7. Where the holding period 0% tax for individuals and exceeds six years association of persons not appearing on the Active Taxpayers’ List, the rate of tax shall not be less than 15% in any case. 8. Future commodity contracts 5% 5%: entered into by members of Pakistan Mercantile Exchange Provided that for securities except at S. No. 8 of the Table-

(i) the rate of 12.5% tax shall be charged on capital gain arising on disposal where the securities are acquired on or after the first day

296 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I of July, 2013 but on or before the 30th day of June, 2022; and

(ii) the rate of 0% tax shall be charged on capital gain arising on disposal where the securities are acquired before the first day of July, 2013: Provided further that the rate for companies in respect of debt securities shall be as specified in Division II of Part I of the First Schedule: Provided also that a mutual fund or a collective investment scheme or a REIT scheme shall deduct Capital Gains Tax at the rates as specified below, on redemption of securities as prescribed, namely: - Category Rate Individual and association of persons 15% for stock funds 15% for other funds Company 15% for stock funds 25% for other funds: Provided also that in case of a stock fund if dividend receipts of the fund are less than capital gains, the rate of tax deduction shall be 15%: Provided also that no capital gain shall be deducted, if the holding period of the security acquired on or before 30th day of June 2024 is more than six years. Explanation.- For the removal of doubt, it is clarified that provisions of this proviso shall be applicable only in case of mutual fund or collective investment scheme or a REIT scheme.‖;

(4) for Division VIII, the following shall be substituted, namely: - -Division VIII The rate of tax to be paid shall under sub- section (1A) of section 37 shall be as follows: -

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 297

-TABLE

July, 2024 Plots d Property not exceed II for companies in two years List on the date of Provided that the rate years of tax for individuals disposal, the rate of holding period years holding period years holding period years

(B) in Part III, -

(1) in Division I, for clause (b), the following shall be substituted, namely: -

-(b) 15% in the case of mutual funds, Real Estate Investment Trusts and cases other than those mentioned in clauses (a), (c) and (d):

298 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I Provided that the rate of tax on dividend received from mutual funds deriving fifty percent or more income from profit on debt shall be 25%.‖;

(2) in Division III, in paragraph (1), in sub-paragraph (b), for clauses (i) and (ii), the following shall be substituted, namely: -(i) in case of a company, 9% of the gross amount payable for toll manufacturing and 5% of the gross amount payable in case other than toll manufacturing; and

(ii) in case other than a company, 11% of the gross amount payable for toll manufacturing and 5.5% of the gross amount payable in other than toll manufacturing.‖; and (C) in Part IV, -

(1) in Division V, in entry (b), in the second column, after the word -form‖ a colon shall be inserted and thereafter the following proviso shall be added, namely: - Provided that in the case of persons mentioned in income tax general order issued under section 114B, the rate of collection of tax shall be 75% of the amount of bill or sale price of internet pre-paid card or prepaid telephone card or sale of units to any electronic medium or whatever form.‖;

(2) in Division VII, in paragraph (1), -

(a) for the Table, the following shall be substituted, namely: - -TABLE S. No. Engine Capacity Rate of Tax

(1) (2) (3) 1. Upto 850 cc 0.5% of the value 2. 851cc to 1000cc 1% of the value 3. 1001cc to 1300cc 1.5% of the value

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 299 4. 1301cc to 1600cc 2% of the value 5. 1601cc to 1800cc 3% of the value 6. 1801cc to 2000cc 5% of the value 7. 2001cc to 2500cc 7% of the value 8. 2501cc to 3000cc 9% of the value 9. Above 3000cc 12% of the value:‖; (b) in the first proviso, the expression -S. Nos. 7 to 9 of‖ shall be omitted;

(3) for Division X, the following shall be substituted, namely: - -Division X Advance tax on sale or transfer of immovable property The rate of tax to be collected under section 236C shall be as set out in the following table: - S. No. Amount Tax Rate

(1) (2) (3) 1 Where the gross amount of the consideration received 3% does not exceed Rs. 50 million 2 Where the gross amount of the consideration received 3.5% exceeds Rs. 50 million but does not exceed Rs 100 million 3 Where the gross amount of the consideration received 4%‖ exceeds Rs. 100 million

(4) for Division XVIII, the following shall be substituted, namely: - -Division XVIII Advance tax on purchase of immovable property The rate of tax to be collected under section 236K shall be as set out in the following table: - TABLE S. No. Amount Tax Rate

(1) (2) (3) 1 Where the fair market value does not exceed Rs. 50 million 3%

300 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

exceed Rs 100 million

(39) in the Second Schedule, -

(A) in Part I, -

(i) after clause (99A), the following new clause shall be inserted, namely: -

buying Diversified Payment Rights from the Authorized Dealers in Pakistan.

Diversified Payment Rights, Special Purpose Vehicle referred in the State Bank of Pakistan‘s Circular(s) or Regulations on Diversified Payment Rights;

(ii) clause (102A) shall be omitted;

(iii) in clause (114B), for the words -Shaheed or the person who dies in service‖, the expression -persons specified in the said proviso‖ shall be substituted; and

expression -2025‖ shall be substituted;

(B) in Part II, in clause (24A), after the word -cigarette‖, the expression -shall be 2.5% gross amount of payment‖ shall be inserted;

(a) in clause (11A), in sub-clause (xliii), for the expression -(126EA)‖, the expression -(126E) and (126EA)‖ shall be substituted;

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 301

(b) after clause (38AA), the following new clause shall be inserted, namely: - -(38AAA) The provisions of section 152 shall not apply to Special Purpose Vehicle referred to in clause 99B of Part I of this Schedule.‖; and

(40) in the Seventh Schedule, -

(a) in rule 1, -

(i) for sub-rule (d), the following shall be substituted, -(d) The amount of -bad debts‖ classified as -sub- standard‖ or -doubtful‖ under the Prudential Regulations issued by the State Bank of Pakistan or provisions for advances, off-balance sheet items or any other financial asset classified in stage I, II or III as performing, under-performing or non-performing under any applicable accounting standard including IFRS 09 shall not be allowed as expense: Provided that only -bad debts‖ classified as -loss‖ pertaining to non-performing assets under the Prudential Regulations issued by the State Bank of Pakistan shall be allowed as expense.‖;

(ii) after sub-rule (d), substituted as aforesaid, the following new sub-rule shall be inserted, namely: - -(da) Provisions or Expected Credit loss for Advances and off balance sheet items or any other financial asset existing before or after the 1st day of January, 2024 under IFRS 09 shall not be allowed as an expense or deduction.‖; and

(iii) in sub-rule (g), for the expression -application of international accounting standards 39 and 40‖, the expression -any applicable accounting standard or policy or any guidelines or instructions of State Bank of Pakistan‖ shall be substituted;

302 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

(b) after rule 3, the following new rule shall be added, namely:- -3A. Notwithstanding any other provision of this Ordinance, where any assets are transferred by an Authorized Dealer, as a consequence of a Diversified Payment Rights transaction, to a Special Purpose Vehicle, it shall be treated as a financing transaction irrespective of the method of accounting adopted by the Authorized Dealer. Explanation.-For the purpose of this clause, Diversified Payment Rights, Special Purpose Vehicle and Authorized Dealer shall mean the ‗Diversified Payment Rights‘, ‗Special Purpose Vehicle‘ and ‗Authorized Dealer‘, respectively, in each case, as referred in the State Bank of Pakistan‘s Circular(s) or Regulations on Diversified Payment Rights.‖; and

(c) in rule (7CA), after the full stop, the following explanation shall be added, namely:- “Explanation.-For removal of doubt it is clarified that the expression -tax year 2023 onwards‖, means that provisions of section 4C are applicable for the tax year 2023 and for all subsequent tax years.‖; and

(41) in the Tenth Schedule,-

(a) in rule 1, -

(i) the expression -the First Schedule to‖ shall be omitted;

(ii) for the second proviso, the following shall be substituted, namely: -Provided further that the tax required to be collected under section 236K shall be at the rates set out in the following table, in case of persons not appearing in the active taxpayers‘ list: - TABLE S. No. Fair Market Value of Immovable Property Tax Rate

(1) (2) (3) 1 Where the fair market value does not exceed Rs. 50 million 12% 2 Where the fair market value exceeds Rs. 50 million but does 16% not exceed Rs. 100 million 3 Where the fair market value exceeds Rs. 100 million 20%:

PART I] THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 303 Provided also that the tax required to be collected or deducted, under sections specified in column (2) against transactions specified in column (3) shall be at the rates specified in column (4) of the following Table, in case of persons not appearing in the active taxpayers‘ list: - S. No. Section Description Tax Rate

(1) (2) (3) (4) 1. Section 151 On yield or profit on debt 35% 2. Section 236C On the gross amount of 10% consideration received on sale or transfer of immovable property 3. section 236G On the gross amount of sale to 2% distributors, dealers or wholesalers other than sale of fertilizer. 4. Section 236H On the gross amount of sale to 2.5%‖; retailers

(b) after rule 1, amended as aforesaid, the following new rule shall be inserted, namely: - -1A. Rate of deduction or collection of tax from persons who are appearing on active taxpayers’ list but have not filed return by the due date. - Where tax is required to be collected in respect of persons appearing on the active taxpays‘ list who have not filed the return by the due date specified in section 118 or by the due date as extended under section 119 or 214A, the rate of tax shall be -

(a) as per rates set out in the following Table in case of tax to be collected under section 236C; TABLE S. No. Gross Amount of Consideration Received Tax Rate

(1) (2) (3) Where the gross amount of consideration received does not 1 6% exceed Rs. 50 million Where the gross amount of consideration received exceeds 2 7% Rs. 50 million but does not exceed Rs. 100 million Where the gross amount of consideration received exceeds 3 8% Rs. 100 million

(b) as per rates set out in the following Table in case of tax to be collected under section 236K:

304 THE GAZETTE OF PAKISTAN, EXTRA., JUNE 30, 2024 [PART I

TABLE

Where the fair market value exceeds Rs. 50 million but does not exceed Rs. 100 million

Provided that the provisions of this rule shall not specified in section 118 or by the due date as extended under section 119 or section 214A for all of the last three tax years preceding the tax year for which the return has not been filed by the due date specified in section 118 or by the due date as extended under section 119 or 214A.‖; and