The Securities and Exchange Commission (SECP) has proposed to the Federal Board of Revenue to provide new tax incentives to companies for enlistment in any registered stock exchange. Sources said on Monday that the SECP has asked the FBR to provide tax credit on listing on stock exchanges.
According to the SECP's proposal, in Finance Act 2011, a tax credit equal to fifteen per cent (15 percent) of the tax payable was allowed for the tax year in which a company opts for enlistment in any registered stock exchange in Pakistan, the SECP consider this tax credit very insignificant. Therefore, the SECP propose that the tax credit under section 65C of the Ordinance equal to fifteen per cent of the tax payable to the companies for opting for enlistment in any registered stock exchange in Pakistan be allowed up-to five years from the tax year in which company is listed.
The existing section 65C (tax credit for enlistment) of the Income Tax Ordinance 2001 said that where a taxpayer being a company opts for enlistment in any registered stock exchange in Pakistan, a tax credit equal to 1fifteen percent of the tax payable shall be allowed for the tax year in which the said company is enlisted.
The SECP has proposed amendment to section 65C (tax credit for enlistment) of the Income Tax Ordinance 2001. The proposed section said where a taxpayer being a company opts for enlistment in any registered stock exchange in Pakistan, a tax credit equal to 15 percent of the tax payable shall be allowed for five tax years in which the said company is enlisted.