Covid-19-tax-relief-tax-exemptions-Pakistan-2020

Tax measures & reliefs in response to COVID-19 in 2020 by Pakistan

January 1, 2021 - ByAdmin

Government in Pakistan have introduced tax measures to reduce the impact of the COVID-19 pandemic in year 2020.

Tax Reliefs in 2020 by Pakistan

Exempted taxes on import of oxygen gas, cylinders & tanks

23 August 2020: FBR exempted taxes on import of oxygen gas, oxygen cylinders and cryogenic tanks. This exemption was available for a period of 3 months starting from 23 June 2020. This relief applicable to LCs opened for GDs filed on or after 23 June 2020.

The Prime Minister’s COVID-19 Pandemic Relief Fund 2020

30 June 2020: In Finance Act 2020 ‘The Prime Minister’s COVID-19 Pandemic Relief Fund 2020’ was added to FBR’s exemptions list. Any donation, made to the fund shall be exempted from tax.

AlSO READ: PM Imran Khan Big Incentive for Construction Industry In Pakistan

30 June 2020: Incentive package for construction industry

The construction sector declared as an ‘industrial undertaking’ through amendment in the Ordinance. The sector is now entitled to take exemption from advance tax otherwise collectible on import of machinery. Introduction of a fixed rate tax regime effective from Tax Year 2020 for builders and developers. The scheme is optional and covers ‘new projects’ and ‘existing projects’ (that start after 17 April 2020 but before 31 December 2020, date extended now up to 30th June, 2021 ) to be completed by 30 September 2022.

Exemption from source of funds to certain conditions, including first purchaser of such building or land with certain conditions. Exemption from withholding tax liability on purchase of building material except steel and cement; and on services of plumbing, electrification, shuttering and allied works obtained from non-corporate service providers.

ALSO READ: FBR announced to give 90pc tax exemption on low-cost housing projects

Exemption on dividend income received from a company of a builder or a developer out of the profits. Low-cost projects developed or approved by Naya Pakistan Housing and Development Authority (NAPHDA) or under the Ehsaas program, the tax rates reduced by 90%. Reduction in capital gains tax chargeable on sale of immovable property.

tax-accounting-services-top-tax-consultants-lahore-pakistan — Ads:

30 March 2020: Reduction of taxes and duties on import and supply of different food items for mitigating the impact of COVID -19

Reduction of tax on the import of different food items reduced to 0% from 2%. Businesses providing food items to Govt. based departmental stores without a brand name will pay 1.5% withholding tax instead of 4.5%; and Additional customs duty (ACD) at 2% on soya bean oil, canola oil, palm oil and sunflower oil (as well as oil seeds) exempted.

ALSO READ: Top tax issues of Pakistan in 2020

Exemption from advance tax on import of plant and machinery

Effective from May 1, 2020, the construction sector is eligible to enjoy exemption from advance tax. On import of plant and machinery. Including claiming a tax credit on income from new projects according to the new tax regime. However, this credit facility is only applicable on the non-corporate sector.

LATEST POSTS

New Taxes on E-commerce Transactions in PakistanJuly 31, 2025
New Taxes on E-commerce Transactions in Pakistan: In the recent budget (Finance Act 2025) Government of Pakistan has taken some significant steps towards the taxation of local ecommerce industry of Pakistan. The new amendments in the Income tax Ordinance 2001 and Sales Tax Act 1990 will affect all those ecommerce businesses operating through online platforms, websites, or courier based Cash on Delivery (COD) Model. Below are the significant highlights of amendments in tax laws of Pakistan which are necessary for your understanding: Enhanced Definition of “Online Market Place” Through Finance Act 2025, section 2(38B) of income Tax Ordinance 2001 amended and definition of “Online Market Place” has been broadened. It now also includes: These will help buying and selling between multiple parties, whether the platform owns the goods/services or not. New Taxes on E-commerce Transactions in Pakistan for Digitally Ordered Goods/Services Through Finance Act 2025, a new section, 6A in the Income Tax Ordinance, introduces a tax on payments received for digitally ordered goods/services through local platforms (including websites). Applies To:This section applies to all persons receiving payments for goods/services delivered from within Pakistan via online platforms. Excludes:It does not include export proceeds received in Pakistan which are already taxed under sections 154 and 154A. Tax Collection by Payment Intermediaries and & Couriers Under amendment in section 153(2A) of Income Tax Ordinance 2001 through Finance Act 2025: This applies to all payments made for digitally ordered goods and services via local platforms, including websites. Rate of Income tax to be deducted from a payment for digitally ordered goods/services Two different tax rates has been introduced for payments to ecommerce sellers against digitally ordered goods, complete description is here: Sales Tax Collection Responsibility As per Sales Tax Act 1990, the responsibility to collect and pay sales tax on digitally ordered goods is explained here: Rates of Sales Tax on Payments against Digitally ordered goods The applicable rates of sales tax to be deducted are given in the Eleventh Schedule of the Sales Tax Act 1990. The sales tax withheld by the payment intermediary or the courier company will be final discharge of tax liability against the digitally ordered goods by the: AS per the eleventh schedule of Sales Tax Act 1990 the rate of sales tax to withhold to withhold by the payment intermediary / Courier Company will be at the rate of 2% of gross value of supplies. Mandatory NTN & Sales Tax Registration To promote documentation and transparency: Unregistered sellers will not be allowed to operate on their platforms.
FBR Extends Sales Tax & FED Return Filing Deadline for June 2025July 25, 2025
FBR Extends Sales Tax & FED Return Filing Deadline for June 2025 – The Federal Board of Revenue (FBR) has officially extended the last date for filing sales tax and Federal excise Duty Return for the period of June 2025. FBR Extends Sales Tax & FED Return Filing Deadline for June 2025 New due date to file the sales tax and FED return is now 4th August 2025 which was due on 18.07.2025. This extension has been granted to to facilitate the taxpayers that they must ensure their monthly compliance delaying due to technical issues facing on FBR Iris Portal. FBR issued a notification in this regard on his official website and communicated the new extended deadline for filing sales tax return.
Budget 2025 Update: FBR Broadens Definition of Online MarketplaceJuly 22, 2025
Budget 2025 Update: FBR Broadens Definition of Online Marketplace: In the recent federal budget 2025-26, the Federal Board of Revenue (FBR) has redefined “Online Market Place” for the purpose of regularizing and taxing the fast growing digital economy of Pakistan. One of the important update in the Income Tax Ordinance, 2001, is the redefinition of the term “online marketplace.” The change in definition will bring a massive change to a wide range of digital platforms and sellers, remodeling how e-commerce competitors deals with the tax system in Pakistan. New Definition of “Online Marketplace” Section 2(38B): “online marketplace” means an information technology platform run by e-commerce entity over an electronic network that acts as a facilitator in transactions that occur between a buyer and a seller and includes “online interfaces” that facilitate, for a fee, the direct interaction between multiple buyers and multiple sellers via digital orders for supply of goods and services, with or without the platform taking economic ownership of the goods or providing or rendering the services that are being sold.“
FBR Opens Tax Return Filing Tax Year 2025 – Great Submit NowJuly 21, 2025
FBR Opens Tax Return Filing Tax Year 2025 – Recently Federal Board of Revenue (FBR) has formally issued the tax return form for Tax Year 2025. It is a great news and now taxpayers can submit their annual income tax returns by using the updated form via the FBR Iris Portal. It is highly recommended to you to file your annual income tax returns well before the last date to avoid tax notices and penalties thereafter. What is Deadline Line for Filing Tax Return? For Filing Tax Return for Tax Year 2025 last date to file tax return for Salaried class, individuals and Partnership businesses is 30th September 2025. For Companies registered under the Companies act 2017 the deadline is 31st December 2025. Who Should File the Income Tax Return? You should file your tax return if you fall in any of the following categories: Benefits of Filing Your Tax Return Following are the benefits of filing tax return in Pakistan. Need Help with Filing your Return? If you need any help in filing your tax return then you may contact us. Contact: Global Tax Consultants, 00923334875413 Address: Office No UM-33, Zainab Tower, Model Town, Link Road, Lahore-Pakistan. https://globaltaxconsultants.pk
FBR Biometric Verification Mandatory by 31st July 2025 – What Taxpayers Must Know?July 20, 2025
FBR Biometric Verification Mandatory by 31st July 2025 – What Taxpayers Must Know? – If you’re Sales tax registered taxpayers in Pakistan, the deadline is ahead: 31st July 2025 like you did your biometric verification last year in July. Under the provision of proviso to sub-rule (4) of rule 5 of the Sales Tax Rules, 2006, every individual, any member of an association of persons, and a director of a company are required to visit e-Sahulat Centre of NADRA during the month of July every year for biometric re-verification Why FBR Biometric Verification Mandatory by 31st July 2025? You must know that if no biometric verification, then no sales tax return filing. How to do Biometric Verification? You have to go to any NADRA e-Sahulat Centre with your original CNIC for biometric verification of sales tax.
FBR Introduces Multi-Factor Login Authenticator for Sales Tax UsersJuly 18, 2025
FBR Multi-Factor Login Authenticator – To ensure privacy, increase of security and simplify access to the sales tax system the Federal Board of Revenue (FBR) through Pakistan Revenue Automation Limited (PRAL) has launched a Multi-Factor Login Authentication system for sales tax registered taxpayers. What are the key features of the new FBR Multi-Factor Login Authenticator? Following are the key features of the new system introduced by the FBR for logging FBR Iris Portal for those taxpayers who are also registered in sales tax with FBR.