Budget Updates 20-21.pdf - MAJOR CHANGES PROPOSED IN BUDGET...

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MAJOR CHANGES PROPOSED IN BUDGET 2020-21 1. SALES TAX The rate of sales tax @ 17% is remains the same. The minimum threshold for obtaining CNIC is propose to be increased from Rs.50,000/- to Rs.100,000/-, the services sector also included in this provision previously just included supplies. For Retail sector which is integrated online with FBR through Point of Sale System, the sales tax is proposed to be reduced to 12% from 14%. The Bill proposed to empower to access the real-time information/databases by various authorities such as NADRA, FIA, Provincial excise and taxation dept. etc. In Twelfth schedule, the Value Addition @ 3% is exempted for manufacturers importing raw material and intermediary goods for in house consumption. Concept of conducting audit proceedings through electronic means introduced through video links or any other facility prescribed by the FBR. In case of supplier is non-active then entire sales tax @ 17% is recoverable, as previously it was 1/10th to 1/15th or in some cases it was 5%. Taxpayer whose refund or input tax adjustment is blocked will continue to be treated as an active taxpayer to facilitate buyers so as they claim input tax on purchases made from them. The condition of 10% payment of tax deposited into Govt. treasury to file the appeal before Appellate Tribunal-Inland Revenue. The bill proposed to reduce the sales tax on import of different mobiles for local supplies. The FBR is proposed to empower to fix the minimum wastage and production….this may increase the exploited by the tax authorities. The time period of Active Tax payer is proposed is extended to three month instead of two months/tax periods. The appeal fees is proposed to be increased to Rs.2500 to Rs.5000, previously it was Rs.1000/- The Bill proposed the zero rate on supply of locally manufactured plant and machinery in Gwadar Free Zone subject to some conditions, restrictions and procedures.
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Every registered person is required to submit a complete return i.e. along with all applicable Annexures in the manner prescribed by the FBR. The CIR (A) is now empowered not to admit any supporting documents which was earlier not produced at adjudication level without any plausible reason. Restriction on input tax as attributable to the prescribed excess supplies to unregistered persons has now been extended to every registered person. Previously, it was applicable only on registered manufacturers. Import or local supplies of smart phones value not exceeding USD 30.00 is subject to fixed sales tax rate of Rs.200/-.
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  • Fall '19
  • Taxation in the United States, Fbr

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