ORDINANCE No OF 2018 AN ORDINANCE
Further to amend the Protection of Economic Reforms Act, 1992 (XII of 1992)
WHEREAS it is expedient further to amend the Protection of Economic Reforms Act, 1992 (XII of 1992) to bring suitable legislative changes in order to further promote documentation of economy in the country;
AND WHEREAS the Senate and the National Assembly are not in session and the President of the Islamic Republic of Pakistan is satisfied that circumstances exist which render it necessary to take immediate action;
NOW, THEREFORE, in exercise of the powers conferred by clause (1) of Article 89 of the Constitution of the Islamic Republic of Pakistan, the President of the Islamic Republic of Pakistan is pleased to make and promulgate the following Ordinance:-
1. Short title and commencement.- (1) This Ordinance may be called Protection of Economic Reforms (Amendment) Ordinance, 2018.
(2) It shall come into force at once.
2. Amendment of section 5, Act XII of 1992.- (1) In the Protection of Economic Reforms Act, 1992 (XII of 1992), in section 5, in sub-section (4), for full stop at the end a colon shall be substituted and thereafter the following proviso shall be added , namely:-
"Provided that no cash shall be deposited in an account of a citizen of Pakistan resident in Pakistan unless the account holder is a filer as defined in Income Tax Ordinance, 2001 (XLIX of 2001)." .
3. Ordinance to Override Other Laws.-The provisions of this Ordinance shall have effect notwithstanding anything contained in Foreign Currency Accounts (Protection) Ordinance, 2001(L of 2001) or any other law for the time being in force.
ORDINANCE No. __ OF 2018
AN ORDINANCE to provide for declaration and repatriation of assets and income held outside Pakistan
WHEREAS there is a large scale non-reporting and under-reporting of assets and income held outside Pakistan and it is expedient to provide for declaration and repatriation of assets and income held outside Pakistan for the purposes hereinafter appearing;
AND WHEREAS the Senate and the National Assembly are not in session and the President of the Islamic Republic of Pakistan is satisfied that circumstances exist which render it necessary to take immediate action;
NOW, THEREFORE, in exercise of the powers conferred by clause (1) of Article 89 of the Constitution of the Islamic Republic of Pakistan, the President of the Islamic Republic of Pakistan is pleased to make and promulgate the following Ordinance:-
1. Short title and commencement.- (1) This Ordinance may be called the Foreign Assets (Declaration and Repatriation) Ordinance, 2018.
(2) It shall come into force at once.
2. Definitions.- In this Ordinance unless there is anything repugnant in the subject or context,-
(a) "cost of acquisition of the mortgaged asset" means the sum of mortgaged payments and other mortgaged cost of acquisition;
(b) "declarant" means a person making a declaration under section 5;
(c) "fair market value" means price of foreign asset determined and declared by a declarant himself, but in no case is less than the cost of acquisition of the foreign assets;
(d) "foreign assets" means any movable or immovable assets held outside Pakistan and includes real estate, mortgaged assets, stock and shares, bank accounts, bullion, cash, jewels, paintings, accounts and loan receivables, beneficial ownership or beneficial interests or contribution in offshore entities and trusts;
(e) "government security" means a bond, note or other debt instrument issued by the Federal Government with a promise of repayment upon maturity;
(f) "liquid assets" means cash or an asset that can be readily converted into cash with a minimal impact on the assets' value and includes bank notes, marketable securities, stocks, promissory notes, government bonds, deposit certificates and other similar instruments; and
(g) "holder of public office" means a person who is or has been at any time since 1st day of January 2000,-
(i) the President of the Islamic Republic of Pakistan or the Governor of a Province;
(ii) the Prime Minister, Chairman Senate, Speaker of the National Assembly, Deputy Chairman Senate, Deputy Speaker National Assembly, Federal Minister, Minister of State, Attorney-General for Pakistan and other Law Officers appointed under the Central Law Officers Ordinance, 1970 (VII of 1970), Adviser or Consultant or Special Assistant to the Prime Minister and holds or has held a post or office with the rank or status of a Federal Minister or Minister of State, Federal Parliamentary Secretary, Member of Parliament, Auditor-General of Pakistan, Political Secretary;
(iii) the Chief Minister, Speaker Provincial Assembly, Deputy Speaker Provincial Assembly, Provincial Minister, Adviser or Consultant or Special Assistant to the Chief Minister and who holds or has held a post or office with the rank or status of a Provincial Minister, Provincial Parliamentary Secretary, Member of the Provincial Assembly, Advocate-General for a Province including Additional Advocate-General and Assistant Advocate-General, Political Secretary;
(iv) the Chief Justice or, as the case may be, a Judge of the Supreme Court, Federal Shariat Court, a High Court or a Judicial Officer whether exercising judicial or other functions or Chairman or member of a Law Commission, Chairman or Member of the Council of Islamic Ideology;
(v) holding an office or post in the service of Pakistan or any service in connection with the affairs of the Federation or of a Province or of a local council constituted under any Federal or Provincial law relating to the constitution of local councils, co-operative societies or in the management of corporations, banks, financial institutions, firms, concerns, undertakings or any other institution or organization established, controlled or administered by or under the Federal Government or a Provincial Government or a civilian employee of the Armed Forces of Pakistan;
(vi) the Chairman or Mayor or Vice Chairman or Deputy Mayor of a zila council, a municipal committee, a municipal corporation or a metropolitan corporation constituted under any Federal or Provincial law relating to local councils;
Explanation.- For the purpose of this sub-clause the expressions "Chairman" and "Vice Chairman" shall include "Mayor" and "Deputy Mayor" as the case may be, and the respective councilors therein; and
(vii) a District Nazim or District Naib Nazim, Tehsil Nazim or Tehsil Naib Nazim or Union Nazim or Union Naib Nazim;
(2) All other words and expressions used but not defined in this Ordinance shall have the same meaning assigned to them under the Income Tax Ordinance, 2001 (XLIX of 2001) and the rules made thereunder.
3. Ordinance to override other laws.- The provisions of this Ordinance shall have effect notwithstanding anything to the contrary contained in any other law for the time being in force.
4. Application.- The provisions of this Ordinance shall apply to-
(a) all citizens of Pakistan wherever they may be, except holders of public office, their spouses and dependent children; and
(b) all foreign assets held by the persons first mentioned in clause (a) and tax paid on the value of such assets under section 8, except where proceedings are pending in any court of law in respect of the foreign assets.
(2) The provisions of this Ordinance shall not apply to any proceeds or assets that are involved in or derived from the commission of a criminal offence.
5. Declaration and repatriation of assets held outside Pakistan.- (1) Subject to the provisions of this Ordinance, any person may make to the Federal Board of Revenue, by the due date specified in section 6, a declaration in respect of foreign assets acquired before commencement of this Ordinance.
(2) The value of a foreign asset shall be fair market value as defined in section 2.
(3) The declaration of value and tax paid in respect of the foreign assets shall be in the manner as set out in Form A of the Schedule to this Ordinance.
(4) The description of the foreign assets declared under sub-section (1) and (3) shall be in the manner as set out in Form B of the Schedule to this Ordinance.
(5) A person declaring foreign assets under sub-section (1), may by the due date as specified in section 6 also repatriate the said foreign assets in Pakistan.
(6) The declaration of foreign assets shall be made in the manner as set out in Form A of the Schedule to this Ordinance, electronically on Federal Board of Revenue's web portal and shall be valid only if it is accompanied by the evidence of payment of tax.
6. Period of applicability.- The declaration and repatriation under section 5 shall be made on or after the tenth day of April, 2018 but on or before the thirtieth day of June, 2018.
7. Charge of tax.- The foreign assets declared and repatriated into Pakistan within the due date shall be chargeable to tax at the rates specified in the Table below, namely:-
TABLE
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S.No Foreign assets Rate (as a percentage
of the value of foreign
assets)
============================================================
(1) (2) (3)
============================================================
1 Liquid assets not repatriated 5%
2 Immovable assets outside Pakistan 3%
3 Liquid assets repatriated and invested
in Government securities upto 5 years
in US dollars denominated bonds
with six-monthly profit payment in
equivalent Rupees (rate of return 3%)
and payable on maturity in equivalent Rupees
2%
4 Liquid assets repatriated
============================================================
8. Payment of tax.- (1) The due date for the payment of tax chargeable under section 7 shall be the date on which declaration is made under section 6.
(2) No tax shall be payable by the declarant under any law for the time being in force including the Income Tax Ordinance, 2001 (XLIX of 2001) where tax has been paid under sub-section (1) in respect of the foreign assets declared under section 5.
9. Currency and rate of conversion.- (1) The value of a foreign asset under sub-section (2) of section 5 shall be in Rupees.
(2) The tax payable under section 8 shall be paid in United States dollars as specified in Form A of the Schedule to this Ordinance.
(3) The value in Rupees under sub-section (1) shall be converted into United States dollars at the State Bank of Pakistan's rate applying between the United States dollar and the Rupee on the date the declaration is made under section 6 and tax is paid under section 8.
10. Mode and manner.- The State Bank of Pakistan (SBP) shall notify the mode and manner of-
(a) repatriation of liquid assets in Pakistan;
(b) deposit of tax in US dollars in SBP; and
(c) deposit of tax in Rupees in the income tax account of the Federal Consolidated Fund.
11. Incorporation in books of account.- (1) Where a declarant has paid tax under section 8 in respect of foreign assets declared under section 5, the declarant shall be entitled to incorporate in his books of account such foreign assets.
(2) For the purpose of the Income Tax Ordinance, 2001 (XLIX of 2001), the cost of acquisition of foreign assets and date of acquisition shall be deemed to be the value declared by the declarant and the date on which declaration has been made by the declarant, respectively.
12. Investment in Government securities.- Investment in Government securities under S.No. 3 of the Table in section 7 shall be made in accordance with a scheme to be introduced by the Government of Pakistan through the State Bank of Pakistan, by notification in the official Gazette, specifying periodic rate of return, the period for the rate of return and period of maturity.
13. Confidentiality.- (1) Notwithstanding the provisions of sub-section (3) of section 216 of the Income Tax Ordinance, 2001 (XLIX of 2001), the Right of Access to Information Act, 2017 (XXXIV of 2017) and any other law for the time being in force, particulars of any person making a declaration under this Ordinance or any information received in any declaration made under this Ordinance shall be confidential.
(2) A person who discloses any particulars in contravention of sub-section (1) shall commit an offence punishable on conviction with a fine of not less than five hundred thousand Rupees but not exceeding one million Rupees or imprisonment for a term not exceeding one year or with both.
14. Declaration not admissible in evidence.- Notwithstanding anything contained in any other law for the time being in force, nothing contained in any declaration made under section 5 shall be admissible in evidence against the declarant for the purpose of any proceedings relating to imposition of penalty or for the purposes of prosecution under any law including Income Tax Ordinance, 2001 (XLIX of 2001).
15. Removal of difficulty.- If any difficulty arises in giving effect to the provisions of this Ordinance, the Federal Government may make such order in writing, as is not inconsistent with the provisions of this Ordinance, for removal of such difficulty.
16. Misrepresentation.- Notwithstanding anything contained in this Ordinance, where a declaration has been made by misrepresentation or suppression of facts, such declaration shall be void and shall be deemed never to have been made under this Ordinance.
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DECLARATION UNDER SECTION 5
==========================================================================================
FULL NAME
CNIC* - -
NTN (if available)
ADDRESS
TELEPHONE NUMBER:
Email:
FOREIGN ASSETS
S.No. Nature of assets Amount in Rupees Tax Rate Tax in Pak Rupees
1. Liquid assets not repatriated 5%
2. Immovable assets outside Pakistan 3%
3. Liquid assets repatriated and
invested in Government securities 2%
4. Liquid assets repatriated 2%
Total tax in Rupees(1+2+3+4)
Total tax in US Dollars
Whether evidence of payment of tax attached YES NO
==========================================================================================
*CNIC includes NICOP or any other identification number issued by National Database and Registration Authority.
=======================================================
DESCRIPTION OF ASSETS
=======================================================
[see section 5(4)]
A. Liquid assets not repatriated
1. Foreign currency
Bank account details Bank name and bank A/c 1
Bank name and bank A/c 2
Bank name and bank A/c 3
Bank name and bank A/c 4
Bank name and bank A/c 5
2. Other liquid assets (securities, stocks, promissory
notes, Government bonds, deposit certificates and other
similar instruments, etc.)
1.
2.
3.
4.
5.
6.
B. IMMOVABLE PROPERTY(Jurisdiction, address and size)
1.
2.
3.
4.
5.
6.
7.
========================================================
VERIFICATION
I, the undersigned, solemnly declare that to the best of my knowledge and belief-
(a) the information given in this declaration is correct and complete; and
(b) the value of foreign assets has truly been declared.
I, further declare that I am competent to make this declaration and verify it in my own name.
Date Signature___________
Name ____________
Mamnoon Hussain
President
ORDINANCE No. __ OF 2018
AN ORDINANCE
to provide for voluntary declaration of domestic assets in Pakistan
WHEREAS there is a large scale non-reporting and under-reporting of assets held in Pakistan and it is expedient to provide for declaration of such assets for the purposes hereinafter appearing;
AND WHEREAS the Senate and the National Assembly are not in session and the President of the Islamic Republic of Pakistan is satisfied that circumstances exist which render it necessary to take immediate action;
NOW, THEREFORE, in exercise of the powers conferred by clause (1) of Article 89 of the Constitution of the Islamic Republic of Pakistan, the President of the Islamic Republic of Pakistan is pleased to make and promulgate the following Ordinance:-
1. Short title and commencement.- (1) This Ordinance may be called the Voluntary Declaration of Domestic Assets Ordinance, 2018.
(2) It shall come into force at once.
2. Definitions.- (1) In this Ordinance, unless there is anything repugnant in the subject or context,
(a) "declarant" means a person making a declaration under section 5;
(b) "domestic assets" means assets of every kind other than foreign assets under Foreign Assets (Declaration and Repatriation) Ordinance, 2018;
(c) "holder of public office" means a person who is or has been, at any time since 1st day of January 2000 ,-
(i) the President of the Islamic Republic of Pakistan or the Governor of a Province;
(ii) the Prime Minister, Chairman Senate, Speaker of the National Assembly, Deputy Chairman Senate, Deputy Speaker National Assembly, Federal Minister, Minister of State, Attorney-General for Pakistan and other Law Officers appointed under the Central Law Officers Ordinance, 1970 (VII of 1970), Adviser or Consultant or Special Assistant to the Prime Minister and holds or has held a post or office with the rank or status of a Federal Minister or Minister of State, Federal Parliamentary Secretary, Member of Parliament, Auditor-General of Pakistan, Political Secretary;
(iii) the Chief Minister, Speaker Provincial Assembly, Deputy Speaker Provincial Assembly, Provincial Minister, Adviser or Consultant or Special Assistant to the Chief Minister and who holds or has held a post or office with the rank or status of a Provincial Minister, Provincial Parliamentary Secretary, Member of the Provincial Assembly, Advocate-General for a Province including Additional Advocate-General and Assistant Advocate-General, Political Secretary;
(iv) the Chief Justice or, as the case may be, a Judge of the Supreme Court, Federal Shariat Court, a High Court or a Judicial Officer whether exercising judicial or other functions or Chairman or member of a Law Commission, Chairman or Member of the Council of Islamic Ideology;
(v) holding an office or post in the service of Pakistan or any service in connection with the affairs of the Federation or of a Province or of a local council constituted under any Federal or Provincial law relating to the constitution of local councils, co-operative societies or in the management of corporations, banks, financial institutions, firms, concerns, undertakings or any other institution or organization established, controlled or administered by or under the Federal Government or a Provincial Government or a civilian employee of the Armed Forces of Pakistan;
(vi) the Chairman or Mayor or Vice Chairman or Deputy Mayor of a zila council, a municipal committee, a municipal corporation or a metropolitan corporation constituted under any Federal or Provincial law relating to local councils;
Explanation.- For the purpose of this sub-clause the expressions "Chairman" and "Vice Chairman" shall include "Mayor" and "Deputy Mayor" as the case may be, and the respective councilors therein; and
(vii) a District Nazim or District Naib Nazim, Tehsil Nazim or Tehsil Naib Nazim or Union Nazim or Union Naib Nazim;
(2) All other words and expressions used but not defined in the Ordinance shall have the same meaning assigned to them under the Income Tax Ordinance, 2001 (XLIX of 2001) and the rules made thereunder.
3. Ordinance to override other laws.- The provisions of this Ordinance shall have effect notwithstanding anything to the contrary contained in any other law for the time being in force.
4. Application.- (1) The provisions of this Ordinance shall apply to-
(a) every company, association of persons and all citizens of Pakistan wherever they may be, except holders of public office, their spouses and dependent children; and
(b) undisclosed income and domestic assets held by the persons first mentioned in clause (a) in Pakistan, except where proceedings are pending in any court of law in respect of the domestic assets.
(2) The provisions of this Ordinance shall not apply to any proceeds or assets that are involved in or derived from the commission of a criminal offence.
5. Declaration of domestic assets in Pakistan.- (1) Subject to the provisions of this Ordinance, any person may make, to the Federal Board of Revenue by the due date specified in section 6, a declaration in respect of undisclosed income and domestic assets acquired before the commencement of this Ordinance.
(2) The value of a domestic asset shall be as specified in section 10.
(3) The description, value and tax paid in respect of the undisclosed income and domestic assets declared in sub-section (1) shall be in the manner as set out in Form A of the Schedule to this Ordinance.
(4) The declaration of undisclosed income and domestic assets shall be made in the manner as set out in Form A of the Schedule to this Ordinance, electronically on Federal Board of Revenue's web portal and shall be valid only if it is accompanied by the evidence of payment of tax.
6. Period of applicability.- The declaration under section 5 shall be made after the tenth day of April, 2018 but on or before the thirtieth day of June, 2018.
7. Charge of tax.- The domestic assets declared within the due date shall be chargeable to tax at the rates specified in the Table below on the value of assets as determined under section 10, namely:-
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S.No. Assets Rate (as a percentage of the value of the asset)
=============================================================================
(1) (2) (3)
=============================================================================
1. Foreign currency held in a foreign currency account in Pakistan as
on the 31st March, 2018 and encashed in equivalent Rupees.
2%
Foreign currency held in a foreign currency account in Pakistan as on
the 31st March, 2018 which is invested in Government securities upto
5 years in US dollars denominated bonds with six-monthly profit payment
in equivalent Rupees (rate of return 3%) and payable on maturity in
equivalent Rupees.
2. Other assets. 5%
=============================================================================
8. Payment of tax.- (1) The due date for payment of the tax chargeable under section 7 shall be the date on which declaration is made under section 6.
(2) No tax shall be payable by the declarant under any law for the time being in force including the Income Tax Ordinance, 2001 (XLIX of 2001) where tax has been paid under sub-section (1) in respect of the foreign assets declared under section 5.
9. Incorporation in books of account.- (1) Where a declarant has paid tax under section 8 in respect of undisclosed income and domestic assets declared under section 5, the declarant shall be entitled to incorporate in his books of account such domestic assets.
(2) For the purpose of the Income Tax Ordinance, 2001(XLIX of 2001), the cost of acquisition of domestic assets and date of acquisition shall be deemed to be the value under sub-section (2) of section 5 and the date on which declaration has been made by the declarant, respectively.
10. Valuation.- For the purpose of this Ordinance, the valuation of assets declared shall be made in the following manner, namely: -
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S.No. Undisclosed income and assets Value for the purpose of section 5(2)
=================================================================================
(1) (2) (3)
=================================================================================
1. Undisclosed income. As declared
2. Open plots and land. Cost of acquisition or FBR
rates, whichever is higher.
3. Super structure. Rs 400 per square feet.
4. Apartments and flats. Cost of acquisition or Provincial
stamp duty rates, whichever is higher.
5. Imported motor vehicles. A-B
A= CIF value plus the amount of all
charges, customs-duty, sales
tax, levies, octroi, fees
and other duties and taxes
leviable thereon and the costs
incurred till their registration
B= a sum equal to 10% of the
said value for each successive
year upto a maximum of five years
6. Motor vehicles
purchased from
a manufacturer or
assembler or dealer
in Pakistan. A-B
A= The price paid by the purchaser,
including the amount of all charges,
customs duty, sales tax and other taxes,
levies, octroi, fees and all other duties
and taxes leviable thereon and the costs
incurred till their registration
B= a sum equal to 10% of the said
value for each successive year upto
a maximum of five years.
7. Used motor vehicles
purchased locally. Value determined in the manner
specified in S.N. 5 or 6, as the
case may be, as reduced by an amount
equal to 10% for every year following
the year in which it was imported or
purchased from a manufacturer
8. Securities and shares
traded on stock exchange. Day-end price of the share or
security quoted on registered
stock exchange as on the 9th April,
2018 and where no day-end price of such
share or security is quoted on stock
exchange on the 9th April, 2018 day-end
price of the share or security quoted on
a date nearest to the 9th April, 2018
9. Securities and shares
not traded on
stock exchange. Break-up value or face value, whichever
is higher. Breakup value shall be the
sum of paid-up capital, reserves and balance
as per profit and loss account as reduced
by the value of preference shares and divided
by the amount of the paid up ordinary share capital.
10. National
saving schemes,
ostal certificates,
bonds, securities
and other similar
investments in capital
instruments not traded
or quoted on stock
exchange
Face value
11. Gold. Rupees 4000 per gram
12. Other precious stones
and metals. Market rate as on the 9th April, 2018
or cost of acquisition, whichever is higher
13. Stock-in-trade. Market rate as on the 9th April, 2018
14. Plant and machinery. Actual cost of acquisition with no
depreciation
15. Accounts receivable.
Actual cost of acquisition
16. Other assets.
17. Prize bonds, cash and bank
accounts including
foreign currency accounts. Face value.
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11. Confidentiality.- (1) Notwithstanding the provisions of sub-section (3) of section 216 of the Income Tax Ordinance, 2001 (XLIX of 2001), the Right of Access to Information Act, 2017 (XXXIV of 2017) and any other law for the time being in force, particulars of any person making a declaration under this Ordinance or any information received in any declaration made under this Ordinance shall be confidential.
(2) A person who discloses any particulars in contravention of sub-section (1) shall commit an offence punishable on conviction with a fine of not less than five hundred thousand Rupees but not exceeding one million Rupees or imprisonment for a term not exceeding one year or with both.
12. Declaration not admissible in evidence.- Notwithstanding anything contained in any other law for the time being in force, nothing contained in any declaration made under section 5 shall be admissible in evidence against the declarant for the purpose of any proceedings relating to imposition of penalty or for the purposes of prosecution under any law including Income Tax Ordinance, 2001 (XLIX of 2001).
13. Removal of difficulty.- If any difficulty arises in giving effect to the provisions of this Ordinance, the Federal Government may make such order in writing, as is not inconsistent with the provisions of this Ordinance, for removal of such difficulty.
14. Misrepresentation.- Notwithstanding anything contained in this Ordinance, where a declaration has been made by misrepresentation or suppression of facts, such declaration shall be void and shall be deemed never to have been made under this Ordinance.
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DECLARATION UNDER SECTION 5
=================================================================================
FULL NAME
CNIC
NTN (if available)
ADDRESS
TELEPHONE NUMBER:
Email:
UNDISCLOSED INCOME AND DOMESTIC ASSETS
S.No. Undisclosed income and assets. Value as per section 10.
1. Undisclosed income.
2. Open plots and land.
3 Super structure.
4 Apartments and flats.
5 Imported motor vehicles.
6 Motor vehicles purchased from
a manufacturer or assembler or
dealer in Pakistan.
7. Used motor vehicles
purchased locally.
8. Securities and shares traded
on stock exchange.
9. Securities and shares not
traded on stock exchange.
10 National saving schemes, postal
certificates, bonds, securities
and other similar investments in
capital instruments not traded or
quoted on stock exchange.
11 Gold
12. Other precious stones and metals.
13 Stock-in-trade.
14 Plant and machinery.
15. Accounts receivable.
16 Other assets.
17 Cash and prize bonds.
18 Government securities.
Total value in Rupees
Tax @ 5% (A)
19. Government securities
(S.No. 1 in the Table under section 7)
Tax @ 2% (B)
Total Tax (A+B)
Whether evidence of payment of tax attached. YES NO
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VERIFICATION
I, the undersigned, solemnly declare that to the best of my knowledge and belief-
(a) the information given in this declaration is correct and complete; and
(b) the value of domestic assets have truly been declared.
I, further declare that I am competent to make this declaration and verify it in my own name.
Date __________ Signature___________
Name ____________
Mamnoon Hussain
President
ORDINANCE No. __ OF 2018
AN ORDINANCE
further to amend the Income Tax Ordinance, 2001
WHEREAS it is expedient further to amend the Income Tax Ordinance, 2001 (XLIX of 2001) for the purposes hereinafter appearing;
AND WHEREAS, the Senate and the National Assembly are not in session and the President of the Islamic Republic of Pakistan is satisfied that circumstances exist which render it necessary to take immediate action;
NOW, THEREFORE, in exercise of the powers conferred by clause (1) of Article 89 of the Constitution of the Islamic Republic of Pakistan, the President of the Islamic Republic of Pakistan is pleased to make and promulgate the following Ordinance:-
1. Short title and commencement.- (1) This Ordinance may be called the Income Tax (Amendment) Ordinance, 2018.
(2) It shall come into force at once.
2. Amendment of Ordinance XLIX of 2001.-In the Income Tax Ordinance, 2001 (XLIX of 2001), -
(1) in section 111,-
(a) for sub-section (2), the following shall be substituted, namely:-
"(2) The amount referred to in sub-section (1) shall be included in the person's income chargeable to tax-
(a) in the tax year to which such amount relates if the amount representing investment, money, valuable article or expenditure is situated or incurred in Pakistan or concealed income is Pakistan-source; and
(b) in the tax year immediately preceding the tax year in which the investment, money, valuable article or expenditure is discovered by the Commissioner and is situated or incurred outside Pakistan and concealed income is foreign-source."; and
(b) in sub-section (4), in clause (a), after the word "channels", the words "not exceeding ten million Rupees in a tax year" shall be inserted;
(2) in section 114,-
(a) in sub-section (1), in clause (b),-
(i) in sub-clause (viii), the word "or" at the end shall be omitted; and
(ii) in sub-clause (ix), for full stop at the end, a semicolon and the word "; or" shall be substituted and thereafter the following new sub-clause shall be added, namely:-
"(x) every resident person being an individual required to file foreign income and assets statement under section 116A.";
(b) in sub-section (2),-
(i) in clause (d), the word "and" at the end shall be omitted; and
(ii) in clause (e), for full stop at the end a semicolon and the word "; and" shall be substituted and thereafter the following new clause shall be added, namely:-
"(f) shall be accompanied with a foreign income and assets statement as required under section 116A."; and
(c) in sub-section (5), in the proviso, for full stop at the end a colon shall be substituted and thereafter the following second proviso shall be added, namely,-
"Provided further that the time-limitation provided under this sub-section shall not apply if the Commissioner is satisfied on the basis of reasons to be recorded in writing that a person who failed to furnish his return has foreign income or owns foreign assets.";
(3) after section 116, the following new section 116A shall be inserted, namely,-
"116A. Foreign income and assets statement.- (1) Every resident taxpayer being an individual having foreign income equal to or in excess of ten thousand United States dollars or having foreign assets with a value of one hundred thousand United States dollars or more shall furnish a statement, hereinafter referred to as the foreign income and assets statement, in the prescribed form and verified in the prescribed manner giving particulars of --
(a) the person's total foreign assets and liabilities as on the last day of the tax year;
(b) any foreign assets transferred by the person to any other person during the tax year and the consideration for the said transfer; and
(c) complete particulars of foreign income, the expenditure derived during the tax year and the expenditure wholly and necessarily for the purposes of deriving the said income.
(2) The Commissioner may, by a notice in writing, require any person being an individual, who in the opinion of the Commissioner on the basis of reasons to be recorded in writing, was required to furnish a foreign income and assets statement under sub-section (1) but who has failed to do so, to furnish the foreign income and assets statement on the date specified in the notice.";
(4) in section 118,-
(a) in sub-section (1),-
(i) for the word "or" a comma shall be substituted;
(ii) after the figure "116" the expression "or a foreign income and assets statement under 116A, if applicable" shall be inserted;
(b) in sub-section (2A), after the figure "116", the expression "or a foreign income and assets statement under 116A, if applicable" shall be added;
(5) in section 182, in the Table, in column (1), after S. No. 1AA and entries relating thereto in columns (2),(3) and (4), the following new S. No and entries relating thereto shall be inserted, namely:-
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"1AAA Where any Such persons 116A"; and
=======================================================================
person fails to shall pay a
furnish a foreign penalty of 2
assets and percent of the
income foreign
statement within income or
the due date. value of the
foreign
assets for
each year of
default.
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(6) in Schedule I, in PART I, for Division I, the following shall be substituted, namely:-
"Division I
Rates of Tax for Individuals
(1) With effect from 1st day of July 2018, the rates of tax imposed on the taxable income of every individual shall be as set out in the following Table, namely:-
TABLE
====================================================================
S.No. Taxable income Rate of tax
====================================================================
(1) (2) (3)
====================================================================
1. Where the taxable income 0%
does not exceed Rs. 1,200,000 5% of the
2. Where the taxable income amount exceeding
exceeds Rs.1,200,000 but Rs.1,200,000
does not exceed Rs.2,400,000
3. Where the taxable income exceeds Rs. 60,000 +
Rs.2,400,000 but does not exceed 10% of the
Rs.4,800,000 amount exceeding
Rs.2,400,000
8. Where the taxable income Rs. 180,000 +
exceeds Rs.4,800,000 15% of the amount
exceeding Rs.48,000,000
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Rates of Tax for Association of Persons
(2) The rates of tax imposed on the taxable income of every association of persons shall be as set out in the following Table, namely:-
TABLE
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S.No. Taxable income Rate of tax
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(1) (2) (3)
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1. Where the taxable income 0%
does not exceed Rs. 400,000
2. Where the taxable income 7% of the amount
exceeds Rs.400,000 but does exceeding Rs.400,000
not exceed Rs.500,000
3. Where the taxable income Rs. 7,000 + 10%
exceeds Rs.500,000 but of the amount
does not exceed Rs.750,000 exceeding Rs.500,000
4. Where the taxable income Rs.32,000 + 15% of
exceeds Rs.750,000 but does the amount exceeding
not exceed Rs.1,500,000 Rs.750,000
5. Where the taxable income Rs.144,500 + 20%
exceeds Rs.1,500,000 but does of the amount
not exceed Rs.2,500,000 exceeding Rs.1,500,000
6. Where the taxable income Rs.344,500 + 25%
exceeds Rs.2,500,000 but of the amount exceeding
does not exceed Rs.4,000,000 Rs.2,500,000
7. Where the taxable income Rs.719,500 + 30%
exceeds Rs.4,000,000 but does of the amount
not exceed Rs.6,000,000 exceeding Rs.4,000,000
8. Where the taxable income Rs.1,319,500 + 35%
exceeds Rs.6,000,000 of the amount
exceeding Rs.6,000,000
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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 35% rate of tax mentioned against S. No. 8 of the Table shall be 32% for tax year 2016 and onwards.
(3) Where the taxable income in a tax year, other than income on which the deduction of tax is final, does not exceed one million Rupees of a person-
(a) holding a National Database Registration Authority's Computerized National Identity Card for disabled persons; or
(b) a taxpayer of the age of not less than sixty years on the first day of that tax year,
the tax liability on such income shall be reduced by fifty per cent.". Mamnoon Hussain President
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