Follow Us on Google News
ISLAMABAD: President Dr. Arif Alvi has signed the Tax Laws (Second Amendment) Ordinance, 2022, increasing the Federal Excise Duty (FED) of Rs36 billion on tobacco industry and other measures including withdrawal of fixed tax on retailers imposed through the electricity bills under the Finance Act 2022, the President House said Monday.
Through the Tax Laws (second amendment) Ordinance 2022, issued on Monday, the government has also reversed several revenue measures announced in the last budget in a bid to facilitate different sectors and taxpayers and comply with some international obligations.
In the budget 2022, the government had introduced the fixed tax scheme for retailers (other than tier-I retailers) on commercial electricity connection with an aim to collect Rs42bn alone from these documentation measures. However, the FBR has now withdrawn fixed tax scheme retrospectively from July 1 this year.
The previous tax regime for retailers, which was prevailing prior to the Finance Act, 2022, has now been restored.
Through the ordinance, federal government has been empowered to make any future scheme and determine its modalities, including tax rate or amount and the date when it will be implemented for retailers to collect tax on commercial connections.
Till the new scheme is announced by the federal government, the previous regime prior to the Finance Act will remain in force. The ECC in its next meeting will approve the new scheme with new rates to charge variable taxes to traders to collect Rs27bn from the retail sector as committed with the IMF.
The president gave the approval to the Ordinance on the advice of the prime minister under the Article 89(1) of the Constitution.
Under the Ordinance, the amendments have been made in Sales Tax Act 1990, Income Tax Ordinance 2001, Federal Excise Act 2005 and Finance Act 2022.
