SOME OF IMPORTANT CHANGES MADE VIDE FINANCE BILL 2007

TAX CREDIT FOR INVESTMENT IN NEW SHARE. (SECTION 62):

A person, other than a company is now entitled to tax credit for investment in shares, as a
original allottee as per following limit:-
a) 10% of the Persons taxable income
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b) Rs. 300,000/- whichever is less.
TAX ON RETAILORS (SECTION 113A) :
A "etailer with #$"%!&'" below "s (0, 00,000)- can file t*rnover ret*rn by paying 0(0%
#ax on his declared t*rnover +*ch "etailer is however can not claim ad,*stment of any
with-holding tax collected or ded*cted
TAX ON RETAILOR!S S"B#ECT TO SALES TAX (SECTION 113B) :
A "etailer who is s*b,ect to +ales tax with t*rnover exceeding ( million can pay single stage
combined sales tax and income tax as per following tax rates:-
i #*rnover between ( million
to 10 million "s -(000 pl*s 0(% of t*rnover
exceeding ( million
ii 'xceeding 10 million "s (0,000 pl*s 0.(% of t*rnover
exceeding 10 million
#he "etailer shall not be entitled to claim any ad,*stment of withholding #ax collected or
ded*cted
FILLING OF WEALTH STATEMENT (SECTION 116)
1 #he /ommissioner is empowered to iss*e notice for filling of wealth statement even
if the declared income is below "s ( lacs
- 0t is mandatory to file the wealth statement where the declared income is "s ( lacs
or more
/ont1d on 22P)-
Auditors, Advocates, Taxation & Company Law Advisors
305, Frere Business Centre,
Frere Road, Near KMC Akhbar
Market,
Karachi-74200
e!" 272#357 $ 272#35%
2772%44 $ 2772%45
2750547
Fa&" 2775000
$ S%&&' ( 2)
ADVANCE TAX "*S 1+7
1 3hile calc*lating advance tax liability the minim*m tax *)s 114 shall also be ta5en
into consideration
- 0n case of first year of a company the advance tax liability shall be paid on the basis
of estimate of 1
st
6*arterly income)t*rnover #he advance tax shall be paid ma5ing
ad,*stment of tax already paid ) ded*cted or collected
EXEMPTION CERTIFICATE. (SECTION 1+,(3))
#he power of commissioner to iss*e exemption certificate *)s 178 has now been restricted
#he following person is now eligible to apply for exemption certificate:-
a A Person 9other than covered by P#") whose income is ':';P# or d*e to bro*ght
forward losses< he is not li5ely to pay any tax
WITHHOLDING TAX ON P"RCHASE OF GOODS - SERVICES (SECTION 1.3).
1) Pres*mptive withholding tax introd*ced last year for services providers to
':P!"#'"+ is now withdrawn
-) A cotton ginner has now option to pay by himself the tax e6*al to the amo*nt of tax
ded*ctible on the payment and prod*ce the evidence to this effect to the withholding
agent
4) #he tax ded*cted *)s 1(4 shall be ad,*stable for the following persons:-
a) A company whose tax has been ded*cted for rendering or providing of
services
b) Advertisement services by owners of news papers and maga=ines
c) +ales of goods and exec*tion of contracts by p*blic company listed on a
registered stoc5 exchange
d) /%0/ is to be *sed for identification p*rpose, as an alternate, where %#% is
not obtained
TAX ON P"RCHASE OF MOTOR CAR (SECTION 231B) .
(% advance ad,*stable tax is to be paid on val*e of car p*rchased from man*fact*rer or
a*thori=ed dealer
PRES"PTIVE TAX ON CNG STATION (SECTION 23+A) .
1) Advance tax > ?% of @as /ons*mption /harges shall be collected by @as /ompany
on gas bills
-) #he tax so collected shall be final tax on the income of /%@ +tation
/ont1d on 22P)4
$ S%&&' ( 3)
TAX COLLECTED ON ELECTRICIT/ (SECTION 23.) :

#he tax collected on electricity bill from a person 9other than a company) shall be ;0%0;$;
#A: on his income and no "'A$%B of tax so collected shall be allowed
CAPITAL GAIN ON DEALING OF SHARE.
#he exemption period is extended *p to 40
th
C*ne -008
TAX ON IMPORTS.
1) #he rate of withholding tax on commercial imports is red*ced to (%
-) #he withholding tax on import of polyester filament yarn is (%
TAX ON EXPORTS (SECTION 1.+) .
#he 3ithholding #ax on 'xports has been revised as *nder:-
%A#$"' !A @!!B+ #A: D'A" -00. #A: D'A" -008
1) 'ngineering goods E
other goods Fisted in
Part 0 +eventh +ched*le 0.(% 1%
-) Feather E #extile made *ps
E other goods Fisted in 100% 1%
Part 00 of seventh sched*le
4) Feather ) #extile article,
/arpet, s*rgical goods 1-(% 1%
E other goods listed in
Part 000 of seventh sched*le
7) "aw /otton E /otton Darn 1(% 1%
WITHHOLDING "*S 1+, FROM MAN"FACT"RER CLA"SE 13 PT II SECOND
SCHED"LE.
Ad,*stable 3G# *)s 178 from man*fact*re on import of:
a) /apital @oods meant for local *se 1%
b) "aw materials for self cons*mption if finished prod*cts are sold locally is 1%
c) Gowever import of polyester filament yarn will be s*b,ect to payment of tax > (%
d) %o 3G# on import of capital goods and raw materials by man*fact*rer, 'xporter
meant for 'xport