The reduction in regulatory duty on the import of industrial inputs/smuggling-prone items would be applicable from the next day of assent given to the Finance Supplementary (Second Amendment) Bill, 2019 by the President.
The statement of objects and reasons of Finance Supplementary (Second Amendment) Bill, 2019 states, "the purpose of this bill is to give effect to the fiscal stabilisation objective of the Government and shall come into force on the next day of assent given to this Act by the President except clause 2 (2) (ii) which shall have effect from 31st March, 2019 and clauses 4(1), 4(2), 4(12)(A)(b), 4(12)(B), 4(12)(C)(d), 4(12)(C)(f) and 4(13)(A)which shall have effect from the first day of July, 2019".
Under the Bill, the reduction of customs duty on the import of inputs/raw materials of industrial sector would be applicable from March 31, 2019. The proposed exemption on import of all items for Ostomy Use, exemption of duty on newsprint, reduction in rate of customs duty on Plastic Moulding Compound would be applicable from the next day of assent given by the President.
The effective date of sales tax and Federal Excise Duty (FED) measures introduced through Finance Supplementary (Second Amendment) Bill 2019, would be from the next day of assent given by the President. However, sales tax exemption on plant and machinery to Greenfield industries would be applicable from July 1, 2019.
The effective date of certain income tax measures introduced through Finance Supplementary (Second Amendment) Bill, 2019 would be July 1, 2019. The measures are: Abolition of tax on undistributed profits (clause 4(1); allow carry forward of capital losses for tax year 2019 and onwards for three years (clause 4(2); enhance and extend exemption from tax on profit & gains to manufacturers of plant and machinery and equipment for dedicated use in renewable generation set up between 1st March, 2019 and 30thJune, 2023 for five years (clause 4(12)(A)(b); reduction in tax liability on inter-corporate dividend in case of companies availing group relief (clause 4(12)(B); exemption from deduction of tax on auction of franchise rights to teams participating in national or international sports league (clause 4(12)(C)(d); exemption of taxable income of banking company from additional financing in specific sectors from super tax (clause 4(12)(C)(f) and reduction in rate of tax on income of banks arising from additional financing to Micro, Small & Medium Enterprises, Low-cost Housing, and Farm Credit [Clause 4(13)].
The effective date of remaining income tax measures introduced through Finance Supplementary (Second Amendment) Bill, 2019 would be from the next day of assent given by the President. The measures included exemption on income of federal government from sale of spectrum and licenses to renewal of licenses; scheme for small traders and shopkeepers; provisional assessment of off-shore assets; tax collection on certain commercial imports as final tax; filing of withholding statement bi-annual instead of monthly; relax restriction for non-filers on purchase of locally manufactured motor vehicles up to 1300CC and to relax restriction on purchase of immovable property as well as locally manufactured vehicles for non-resident Pakistani citizens; advance income tax rates on import of mobile phones; abolition of advance income tax on cash withdrawals for filers; increase rate of advance income tax on purchase registration or booking of motor vehicles by non-filers and other income tax measures specified in the Finance Supplementary (Second Amendment) Bill, 2019.
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