ISLAMABAD: A per the order of the Supreme Court of Pakistan (SCP) – that was told earlier that customers were getting only Rs. 61.93 on a Rs. 100 top-up – for 15 days (starting from 12 am Thursday 14th of June, 2018) FBR and cell phone service providers will not be charging any tax on top-ups.
CJP while hearing a suo moto case noted that cellular companies were fleecing the consumers, and thus had restrained FBR and cellular companies from deducting withholding tax and other charges on top-up cards till further orders. After fifteen days a mechanism will be introduced to rationalize the amount of tax to be collected on top-ups.
Relevant pieces published earlier:
i) Suspending the exorbitant tax deductions on prepaid mobile cards the CJP has given two days for the order to be implemented. He was hearing a suo motu case at the court’s registry here today. The CJP termed Rs. 38.8.08 deduction on a Rs. 100 prepaid mobile card as illegal. Court expressed its astonishment noting that even a laborer (who hardly manages to generate a hundred rupees a day) was asked to pay withholding tax. According to details the Apex Court had taken notice of the exorbitant taxes last May and asked all the telecommunication companies and the Attorney General of Pakistan to submit their replies on the anomaly.
ii) Federal Bureau of Revenue (FBR) on Saturday has submitted in SCP its response apropos composition of taxes deducted from mobile pre-paid top-up cards. It is pertinent to remind the readers here that SCP has ordered FBR, federal and provincial governments on 8th of May to inform why 42% worth of card was being deducted on mobile prepaid cards. The apex court took notice of public complaints that high amount of tax and other charges were being deducted from the topping up of the balance through mobile easy load and calling cards besides taxing the calls.
It had been told that 5.5 percent was deducted as a withholding tax, 19pc as sales tax and another 10pc as services charges. FBR, attempting to justify the levying of withholding taxes on recharging, held that due to a lack of documentation of economic transactions in developing countries, the tax base and revenue collection is low, which is why withholding taxes are the main source to broaden the tax base and generate revenue. A person has the right to claim a refund if his annual tax liability is less than the tax withheld. FBR went on to claim that the same modus operandi was prevalent in many countries and taxes were lower than in many countries. (Published on 20th of May 2018)
iii) SC, taking suo motu notice of huge deductions of prepaid billing as a tax by mobile companies, has issued a notice to FBR, cellular concerns and Attorney General of Pakistan here today.CJP wants Attorney General of Pakistan to explain as to how much and what amount is being deducted or taxed on a calling card/easy load of Rs100. According to details the three-judge bench headed by CJP, while noting a large number of complaints from people in this respect, has fixed the hearing on 8th of May. (Published on 3rd of May, 2018)
Tokyo stocks close lower
TOKYO: Shares here closed lower today as uncertainty caused by factors including Brexit and trade tensions weighed on the market, wiping out early gains.
The benchmark Nikkei 225 index fell 0.34 percent or 71.48 points to 21,148.02 while the broader Topix index was down 0.91 percent or 14.50 points at 1,575.31. Tokyo shares opened higher, rebounding from sharp drops the previous day, with investors apparently relieved that Wall Street eked out gains after a volatile session.
“But sentiment worsened as investors remained cautious amid uncertain elements such as the postponement of Britain’s Brexit vote and the US-China trade war,” Daiwa Securities senior technical analyst Hikaru Sato told AFP. European stock markets and the pound slid Monday after British Prime Minister Theresa May said she was delaying a parliamentary vote on her deal to leave the EU after conceding it would not win sufficient support.
“The market is concerned that the postponement uses up valuable time before the 29th March exit date, and the risk of a no-deal scenario is growing,” David de Garis, director of economics and markets at National Australia Bank said in a commentary. The dollar slipped to 113.10 yen in late Asian trade from 113.35 yen in New York Monday afternoon. In individual stocks trade, SoftBank Group jumped 2.44 percent to 8,827 yen after announcing Monday it aims to raise over $23 billion by listing its Japanese mobile unit next week.
Nissan kept falling, down 3.10 percent at 915.7 yen after tumbling 2.90 percent on Monday as ousted chairman Carlos Ghosn was charged and faced new allegations of alleged financial misconduct. Prosecutors also charged Nissan for filing documents that allegedly understated Ghosn’s earnings. The Nikkei daily reported Tuesday that Nissan plans to book years of under-reported compensation paid to Ghosn as expenses in the year to March 2019 all at once, a move that could worsen the automaker’s balance sheet. Toyota lost 1.09 percent to 6,745 yen but Sony rose 0.72 percent to 5,735 yen.
Pound stuck a 20-month low
HONG KONG: Asian equities were mixed Tuesday as investor attempts to track gains in New York are weighed by a perfect storm of issues that have hammered global markets, while the pound remained stuck around 20-month lows on Brexit uncertainty.
Bargain-buyers tried to step in after the latest sell-off but were unable to gain traction, with fears about the outlook for the global economy keeping sentiment beaten down. The China-US trade row, signs of softness in both countries’ economies, the Huawei arrest, Brexit, demonstrations in France and tanking oil prices are among the problems facing investors, and analysts warned of more volatility to come.
Adding to those problems is upheaval in India – another crucial economy – where the head of the central Reserve Bank of India has resigned following a row with Prime Minister Narendra Modi’s administration over alleged government interference. Monday’s development sent the rupee, which was already Asia’s worst-performing currency, tumbling more than one percent Tuesday, with speculation the RBI had intervened to pare the losses. The Mumbai stock market initially fell a similar amount before bouncing back.
Global risk sentiment “is facing a towering wall of worry as virtually every major economy in the world is slowing, suggesting the synchronized global slowdown is accelerating at a much faster pace than thought,” said Stephen Innes, head of Asia-Pacific trade at OANDA. In Asian trade, Hong Kong rose 0.2 percent and Shanghai gained 0.4 percent but Tokyo shed 0.3 percent. Singapore slipped 0.3 percent, Seoul was marginally lower and Sydney rose 0.4 percent. Bangkok and Jakarta slipped, while Wellington, Manila, and Taipei were up.
Pound sinks below $1.26
LONDON: Sterling fell under $1.26 today to hit a 20-month low after Prime Minister Theresa May delayed a critical vote on her Brexit deal one day before it was due.
Just after 1600 GMT, sterling sank by more than 1.5 percent to strike $1.2507 – which was the lowest level since April 2017. That compared with $1.2640 before May made her official announcement in the House of Commons. At the same time, the euro was propelled to 90.87 pence, reaching a peak last seen at the end of August. “During Prime Minister May’s speech to the House, sterling fell through $1.26 to trade (at) levels not seen in 20 months, bringing the 2017 lows at $1.19 into focus,” ETX Capital analyst Michael Baker told. He added: “With the UK due to leave the European Union on March 29, the prospect of no deal and further instability is weighing on the pound.” May said she had listened to the concerns of critics and in the face of a likely rejection.
The premier explained she would seek “assurances” from other European leaders ahead of an EU summit later this week in a bid to try to win back support for her maligned plan in Britain. “If we went ahead and held the vote tomorrow the deal would be rejected by a significant margin,” May told parliament. “We will therefore defer the vote scheduled for tomorrow and not proceed to divide the house (of Commons) at this time.” The British pound had already been languishing in the doldrums in the face of heightened Brexit uncertainty. “Political uncertainly continues to gnaw away at the nerves of investors,” added Rabobank analyst Jane Foley. “Anxiety may have being triggered by Brexit – but the future and functioning of the government is now also a threat for the pound.”