TAX LAWS (AMENDMENT) ACT, 2023
ACT NO. XVI OF 2023
An Act further to amend certain laws relating to taxes and duties
[Gazette of Pakistan, Extraordinary, Part-I, 21st April, 2023]
No. F. 22(32)/2022-Legis., dated 20.4.2023.–The following Act of Majlis-e-Shoora (Parliament) received the assent of the President on the 20th April, 2023 is hereby published for general information:–
WHEREAS, it is expedient further to amend certain laws relating to taxes and duties for the purposes hereinafter appearing;
It is hereby enacted as follow:–
- Short title and commencement.–(1) This Act shall be called the Tax Laws (Amendment) Act, 2023.
(2) It shall, unless specified otherwise come into force at once.
- Amendments of the Sales Tax Act 1990.–In the Sales Tax Act, 1990, the following further amendments shall be made, namely:–
(a) in Section 2, in Clause (46), in sub-clause (i), in the explanation, after the word “electricity”, the expression “or natural gas including re-gasified liquefied natural gas” shall be inserted;
(b) in Section 3,–
(i) for sub-section (9), the following shall be substituted and shall be deemed to have been so substituted from the 1st day of July, 2022. namely:-
“(9) Notwithstanding anything contained in sub-section (1), tax shall be charged from retailers, other than those falling in Tier-1, through their monthly electricity bills, at the rate of five percent where the monthly bill amount does not exceed rupees twenty thousand and at the rate of seven and half percent where the monthly bill amount exceeds the aforesaid amount and the electricity supplier shall deposit the amount so collected directly without adjusting against his input tax:
Provided that the tax under this sub-section shall be in addition to the tax payable on supply of electricity under sub-Sections (1), (1A) and (5):
Provided further that the Commissioner of Inland Revenue having jurisdiction shall issue order to the electricity supplier regarding exclusion of a person who is either a Tier-1 retailer or not a retailer.”; and
(ii) after sub-section (11), the following new sub-section shall be added namely:–
“(12) Notwithstanding anything contained in this Act, the Federal Government may, in lieu of or in addition to the tax under sub-section (9), by notification in the official Gazette, levy and collect such amount of tax at such rates and from such date as it may deem fit, from retailers, other than those falling in Tier-1, through their monthly electricity bill, and may also specify the mode, manner or time of payment of such tax:
Provided that different rates or amounts of tax may be specified for different persons or class of persons.”; and
(c) in the Sixth Schedule, in Table-2, in column (1), after serial number 54, the following new serial number and entries relating thereto in columns (2) and (3) shall be added; namely:–
|“55.||Single cylinder agriculture diesel engines (compression ignition internal combustion piston engines) of 3 to 36 HP.||Respective headings|
- Amendments of Income Tax Ordinance, 2001 (XLIX of 2001).–In the Income Tax Ordinance, 2001 (XLIX of 2001), the following further amendments shall be made, namely:-
(1) for Section 99A, the following shall be substituted and shall be deemed to have been so substituted from the 1st day of July, 2022, namely:–
“99A. Special provisions relating to payment of tax through electricity connections. (1) Notwithstanding anything contained in the Ordinance, a tax shall be charged and collected from retailers other than Tier-I retailers as defined in the Sales Tax Act, 1990 (VII of 1990) and specified service providers on commercial electricity connections at the rates specified the income tax general order issued in terms of sub-section (2).
(2) For the purposes of this section, the Federal Government or the Board with the approval of the Minister in-charge pursuant to the approval of the Economic Coordination Committee of the Cabinet may, issue an income tax general order to–
(a) provide the scope, time, payment, recovery, penalty, default surcharge, adjustment or refund of tax payable under this section in such manner and with such conditions as may be specified;
(b) provide the collection of tax on the amount of bill or on any basis of consumption, in addition to or in lieu of advance tax collectible under sub-section (1) of Section 235, at such rates or amounts, from such date and with such conditions as may be specified;
(c) provide record keeping, filing of return, statement and assessment in such manner and with such conditions as may be specified;
(d) provide mechanism of collection, deduction and payment of tax in respect of any person;
(e) include or exempt any person or classes of persons, any income or classes of income from the application of this section, in such manner and with such conditions as may be specified; and
(f) provide that tax collected under this section shall in respect of such persons or classes of persons be adjustable, final or minimum, in respect of any income to such extent and with such conditions as may be specified.
(3) The provisions of sub-section (1) of Section 235 shall apply to the persons as specified therein unless specifically exempted under the income tax general order issued under sub-section (2).
(4) The provisions of Section 100BA and Rule 1 of the Tenth Schedule shall not apply to the tax collectible under this section unless specifically provided in respect of the person or class of persons mentioned in the income tax general order issued under sub-section (2).
(2) in Section 235, the sub-section (1A) shall be omitted and deemed to have been so omitted from the 1st day of July, 2022;
(3) in the First Schedule, in Part IV,–
(a) in Division III, in clause (2), for the Table, the following shall be substituted, namely:–
|“S. No.||Capacity||Rs. per seat per annum Non Air Conditioned||Rs. per seat per annum Air Conditioned|
|1.||4 or more persons but less than 10 persons||200||375|
|2.||10 or more persons but less than 20 persons||500||750|
|3.||20 persons or more||1000||1500”; and|
(b) in Division IV, clause (3)shall be omitted;
(4) in the Second Schedule, in Part I,–
(a) after omitted clause (5), the following new clause shall be inserted and deemed to have been so inserted from the 1st day of July, 2022, namely:–
“(5A) Any allowance or perquisite paid or allowed as such outside Pakistan by the Government to a citizen of Pakistan for rendering service outside Pakistan.”; and
(b) after clause (105B), the following new clause shall be inserted namely:–
“(105C) Any income derived by Kuwait Foreign Trading Contracting and Investment Company or Kuwait Investment Authority being dividend of the Pak-Kuwait Investment Company in Pakistan from the year of incorporation of PakKuwait Investment Company.”; and
(5) in the Tenth Schedule, in Rule 10, after the omitted clause (h), the following new clause shall be inserted; namely:–
“(ha) tax collected under Section 234 during the period starting from the date of commencement of the Tax Laws Second Amendment) Ordinance, 2022 and ending on the 30th day of June, 2023 in respect of goods transport and passenger transport vehicle.”.
- Amendments of the Federal Excise Act, 2005.–In the Federal Excise Act, 2005, in the First Schedule, in Table-1, in
Column (1), the following further amendments shall be made,
(a) against serial number 7, in column (4), for the word “Ten rupee”, the words “Three hundred and ninety rupees” shall be substituted;
(b) against serial number 9, for the entry in column (4), the following shall be substituted, namely:–
“Rupees six thousand five hundred commencing on the 22nd day of August, 2022 till the 13th day of February, 2023 and Rupees sixteen thousand five hundred from the 14th day of February, 2023.”; and
(c) against serial number 10, for the entry in column (4), the following shall be substituted, namely:–
“Rupees two thousand and fifty commencing on the 22nd day of August, 2022 till the 13th day of February, 2023 and Rupees five thousand and fifty from the 14th day of February, 2023.”.
- Amendment of Section 8 of the Finance Act, 2022.–In the Finance Act, 2022, in Section 8, the following further amendments shall be made, namely:–
(a) in sub-section (13), after clause (c), the following new clause shall be inserted, namely:-
“(ca) “motor vehicle held in Pakistan” includes car, caravan automobiles, jeep, limousine, pickup, sports utility vehicle, trucks, vans, wagon and any other automobile excluding–
(i) a motor vehicle used for public transportation, carriage of goods and agriculture machinery; and
(ii) any motor vehicle held in Pakistan by a foreign diplomat or foreign diplomatic mission.”; and
(b) in the First schedule, for the expression “(see section 1)” the expression “[see sub-section (1)]” shall be substituted.