News Paper: Business Recorder
ISLAMABAD (July 21 2010): The Federal Board of Revenue has worked out revenue impact of over Rs 60 billion on transfer of collection on services to provinces as specified in the Federal Excise Act. Sources told Business Recorder here on Tuesday the major portion of sales tax within the services sector is coming from telecommunication sector that is over and above Rs 40 billion whereas the revenue impact of the remaining services, if taken individually, is negligible.
The sales tax collection from telecom services vary on year to year basis, depending on the contribution made by the telecom sector particularly cellular companies. However, collection is above Rs 40 billion in a fiscal year under this head. According to sources, the Board is collecting federal excise duty on excisable services including telecommunication, as the relevant schedule of the Federal Excise Act has not been rescinded.
The FBR will exempt the services specified in the Table-II of the First Schedule of the Federal Excise Act in case the services have been transferred to the provinces. Sources said the revenue impact of the reformed general sales tax (GST) would be visible depending on the status of services sector under the new regime. A key service ie telecommunication is still under the purview of the Federal Excise Act. Unless or until this service is being exempted from the Federal Excise Act, the same cannot be transferred to provinces.
The Table-II of the First Schedule of the Federal Excise Act covers excisable services including advertisement on closed circuit TV; advertisements on cable TV network; advertisements in news papers and periodicals (excluding classified advertisements) of hoarding boards, poles signs and sign boards; facilities for travel including services provided or rendered in respect of travel by air within the territorial jurisdiction of Pakistan, services provided or rendered in respect of travel by air embarking on international journey to or from Pakistan, passengers embarking or from Saarc region, UAE (Middle East), Saudi Arabia, Africa, Afghanistan, passengers embarking to or from Europe, Far East, China, USA, Canada, Australia, South America, others; inland carriage of goods by air; shipping agents; telecommunication services including telephone services, fixed line voice telephone services, wireless telephone, cellular telephone, wireless local loop telephone, video telephone, payphone card, pre-paid calling cards, voice mail service, messaging service, short message service (SMS), multimedia message service (MMS), bandwidth services used for voice and video telecommunication vices, fibre-optic based, co-axial cable based, microwave based, satellite based, telegraph, telex, telefax, store and forward fax services, audiotext services, teletext services, trunk radio services, paging services, voice paging services, radio paging services, vehicle tracking services, burglar alarm services, services provided or rendered in respect of insurance to a policy holder by an insurer, including a re-insurer [in case where direct insurance service has been provided] including goods insurance, fire insurance, theft insurance, marine insurance, other insurance; services provided by banking companies or non-banking financial companies; franchise services, services provided by property developers or promoters for development of purchased or leased land for conversion into residential or commercial plots, construction of residential or commercial units, services provided of rendered by stock brokers, services provided or rendered by port and terminal operators in relation to imports excluding stevedoring services.
-www.brecorder.com
The sales tax collection from telecom services vary on year to year basis, depending on the contribution made by the telecom sector particularly cellular companies. However, collection is above Rs 40 billion in a fiscal year under this head. According to sources, the Board is collecting federal excise duty on excisable services including telecommunication, as the relevant schedule of the Federal Excise Act has not been rescinded.
The FBR will exempt the services specified in the Table-II of the First Schedule of the Federal Excise Act in case the services have been transferred to the provinces. Sources said the revenue impact of the reformed general sales tax (GST) would be visible depending on the status of services sector under the new regime. A key service ie telecommunication is still under the purview of the Federal Excise Act. Unless or until this service is being exempted from the Federal Excise Act, the same cannot be transferred to provinces.
The Table-II of the First Schedule of the Federal Excise Act covers excisable services including advertisement on closed circuit TV; advertisements on cable TV network; advertisements in news papers and periodicals (excluding classified advertisements) of hoarding boards, poles signs and sign boards; facilities for travel including services provided or rendered in respect of travel by air within the territorial jurisdiction of Pakistan, services provided or rendered in respect of travel by air embarking on international journey to or from Pakistan, passengers embarking or from Saarc region, UAE (Middle East), Saudi Arabia, Africa, Afghanistan, passengers embarking to or from Europe, Far East, China, USA, Canada, Australia, South America, others; inland carriage of goods by air; shipping agents; telecommunication services including telephone services, fixed line voice telephone services, wireless telephone, cellular telephone, wireless local loop telephone, video telephone, payphone card, pre-paid calling cards, voice mail service, messaging service, short message service (SMS), multimedia message service (MMS), bandwidth services used for voice and video telecommunication vices, fibre-optic based, co-axial cable based, microwave based, satellite based, telegraph, telex, telefax, store and forward fax services, audiotext services, teletext services, trunk radio services, paging services, voice paging services, radio paging services, vehicle tracking services, burglar alarm services, services provided or rendered in respect of insurance to a policy holder by an insurer, including a re-insurer [in case where direct insurance service has been provided] including goods insurance, fire insurance, theft insurance, marine insurance, other insurance; services provided by banking companies or non-banking financial companies; franchise services, services provided by property developers or promoters for development of purchased or leased land for conversion into residential or commercial plots, construction of residential or commercial units, services provided of rendered by stock brokers, services provided or rendered by port and terminal operators in relation to imports excluding stevedoring services.
-www.brecorder.com
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