The Karachi Stock Exchange (KSE) on Wednesday informed that the Advance Tax in respect of financing of carryover trades in share business collected under Section 233A (1)(d) has been omitted under amendments made in the Income Tax Ordinance, 2012 which will come into force from July 1 this year. Accordingly, the taxes currently collected by the Exchange have been revised as under:
1. Capital Value Tax (CVT) on purchase of shares of a public company listed on a registered stock exchange in Pakistan (section 7 of the Finance Act of 1989 would be collected at the rate of 0.01 percent of the purchase value without any change.
2. Advance Tax on trade value of shares (Section 233A(1)(C) was omitted.
3. Advance Tax in respect of financing of carry over trades in share business (Section 233A(1)(d) 10 percent of the carryover charge was omitted.
4. Advance Tax on purchase value of shares traded in lieu of tax on commission (Section 233A(1)(a) to be collected at the rate of 0.01 percent of purchase value without any change.
5. Advance Tax on sale value of shares traded in lieu of tax on commission (Section 233A(1)(b) to be collected at the rate of 0.01 percent of share value without any change.
The Capital Value Tax (CVT) on purchase of shares of a public listed on a registered stock exchange in Pakistan was inserted in the Finance (Amendment) Ordinance, 2012 promulgated on April 24 this year (as already notified through KSE notice dated April 26, 2012). This is also specified in the Finance Act, 2012.
The advance tax on trade value of share collected under Section 233A(1)(c) was omitted in the Finance (Amendment) Ordinance, 2012 promulgated on April 24 (as already notified through KSE notice dated April 26, 2012). This is also specified in the Finance Act of 2012 - there is no tax now under this head.
Matters relating to Capital Gains Tax (CGT) and Collection of Advance Tax under Section 233A in respect of margin financing in share business at the rate specified in Division 11A of Part IV of First Schedule, as specified in the above mentioned Finance (Amendment) Ordinance, 2012 and the Finance Act, 2012, respectively, are being dealt with separately by the National Clearing Company of Pakistan Limited (NCCPL).