New rules to make Sales Tax refund
more exporter-friendly

Sohail Sarfaraz

ISLAMABAD (March 30 2004): The new 'Sales Tax Refund Rules 2004' will be instrumental in giving preference to exporters under Gold/Silver categories available as per existing rules, making the refund procedure more exporter-friendly.

Moreover, the exporters with more volume of export per annum will be given preference in issuance of refund as compared to those with less volume.

The CBR will also give high rating to exporters who secure earlier registration as compared to newly registered persons.

Official sources told Business Recorder here on Monday that the new refund procedure would not have categorisation of exporters as 'Gold' or 'Silver', etc for payment of refund. But the CBR will definitely give preference to those exporters who were operating under these categories as per existing rules.

Under the new parameters, claimants will be categorised on the basis of past record, annual turnover and overall status of exporter under the existing rules. The exporters with Gold/Silver categories will be considered as low risk under the new rules and could be given green channel facility for speedy payment of refund.

The CBR will shortly discuss these parameters with export associations and representatives of trade bodies.

The parameters will be fed in department's computers for categorisation of exporters as high risk or low risk for issuance of refund through different channels like green, yellow and red.

The CBR has given March 31 as deadline for comments on new refund rules. However, according to sources, no association has proposed any major change in the new rules.

The exporters have opposed comprehensive documentation, including submission of bills of export and bills of lading/airway bills etc under new rules.

The CBR will also verify the authenticity of export documents pertaining to South Africa, UAE and Saudi Arabia under refund procedure 2004, whereas exports to other countries will be treated as low risk on the basis of past record of exporters.

CBR will assign high-risk 'Yellow Channel' or 'Red Channel' to exporters of textile products to UAE, Saudi Arabia and South Africa, and claim sales tax refund against over-valued exports to these countries.

In case of exports to European Union (EU) and the United States of America (USA), the genuine exporters would be able to get refund within 24 hours using 'Green Channel' facility as per refund rules 2004.

As per rule 6 of the proposed refund rules which deals with scrutiny of refund claims-On receipt of the refund claim, it shall be uploaded in Sales Tax Automated Refund Repository (STARR) computer system, which will assign it a unique claim number, process it automatically on the basis of parameters approved by the Board, and assign it to either 'Green', 'Yellow' or 'Red' channel.

The refund cases will be put in high/low risk categories after scrutinising computer profiles of exporters for determining whether refund should be paid promptly or after comprehensive audit.

Following this procedure, commercial exporters and manufacturers-cum-exporters will be declared as Low Risk, Medium Risk or High Risk after going through the profiles of exporters stored in 'STARR refund automation program'.

Copyright Business Recorder, 2004

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Faysal Bank earns Rs 2.15 billion
net profit in 2003

RECORDER REPORT

KARACHI (March 30 2004): Faysal Bank Limited has earned the profit highest amongst banks in Pakistan as Rs 2.15 billion after tax in the year 2003.

Faysal bank held its Annual General Meeting of shareholders on Monday, which was chaired by the Director of the Bank Sanaullah Qureshi and member of its audit committee.

The Bank's earnings per share grew by 227 percent over the previous year to Rs 8.12 per share. All financial indictors showed an upward trend with deposits growing 28 percent and financing 34 percent.

The 2003 annual audited accounts and financial reports of the bank were presented for approval.

The shareholders unanimously approved the same, highly appreciating the performance of Faysal Bank and profit it made during 2003.

The rating of the Bank based on its 2003 performance was further upgraded to AA for the medium to long term and stands in excess of Rs 5 billion at close of 2003.

The shareholders unanimously approved the distribution of a 20-percent final cash dividend and 10 percent bonus shares in addition to 25 percent interim cash dividend already paid by the Bank to its shareholders.

The Bank from 11-branch network in 1999 grew to 30 branch strong with plans to have 50 branches by end of 2004.

Copyright Business Recorder, 2004

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Advance tax collection to go by June 2005

* Over Rs 25b is raised through advance collection and withholding refunds

ISLAMABAD: Abdullah Yousaf, chairman of the Central Board of Revenue (CBR), has set a June 2005 deadline to eliminate advance tax collection and delay in refunds, an official said here Monday.

In a recent series of collectors conferences and interactions with senior tax officials, Mr Yousaf made it clear to the tax managers that from June 2005 CBR would not allow advance tax collection and withholding of refunds of the business community, he said.

Advance tax collection and withholding of billions of rupees worth of refunds of businesses every year enable the tax authorities to meet ambitious annual targets of revenue collection, but create liquidity problems for businesses.

The official said every year in December and June CBR officials resort to advance income tax and sales tax collection from public and private companies.

He said more than Rs 25 billion is raised through advance tax collection and by withholding refunds of exporters, importers and manufacturers.

In the current fiscal, the tax authorities may again repeat the long-standing exercise of raising advance tax and also delaying the refunds of the business community to achieve the Rs 510 billion target. But from June 2005 neither there will be advance collection of income tax, sales tax nor delay in refunds, he added.

The CBR official pointed out that for the past many years the business community of the country had been demanding the payment of refunds without the traditional delay.

He said that the task of abandoning advance tax collection and eliminating delay in refunds seems very difficult, but it can be achieved in the existing scenario as all the sectors of economy are showing strong performance, leading to a sharp increase in tax revenue collection in this fiscal.

Growing exports, imports, industrial production, credit provision by banks to companies and consumers have had a positive impact on revenue collection.

The official also said that during recent meetings the tax managers have assured the new chairman CBR of the elimination of advance tax collection and delay in refunds. The tax officials have also assured the CBR chief that the current target of Rs 510 billion would be achieved by June.

The CBR has recorded a sharp increase in tax revenue in the first eight months of this fiscal because of improved economic activity. Total revenue collection in July to February this fiscal stood at Rs 310 billion that is Rs 12 billion above the required target of Rs 298 billion. —JM

http://www.dailytimes.com.pk/default...0-3-2004_pg5_4

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NPO, WCCI sign MoU

LAHORE: The National Productivity Organization (NPO) of the ministry of industries and production and the Women Chamber of Commerce and Industry (WCCI) has signed an MoU to undertake initiatives regarding the provision of assistance to the women entrepreneurs. A press release issued here Monday said that the MoU would help entrepreneurs in the required areas like technical, marketing, financial, management, regulatory, environment, productivity and quality, promoting and developing institutional networks with other micro, small and medium enterprises (MSMEs) linked organisations to share and use research information in order to further strengthen and support MSMEs. Umar Aftab, the chief operating officer of WCCI, said NPO would provide sector-specific technical training to MSMEs based on identified needs and would facilitate in skills up-gradation, as the assistance would be provided under the Asian Productivity Organization’s (APO) Technical Expert Services (TES) programme. The WCCI would identify export-oriented sectors and entrepreneurs problems where technical assistance under APO TES programme would be needed, he added. —Staff Report

http://www.dailytimes.com.pk/default...-3-2004_pg5_21

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Pakistan Has Potential To Rise As Developed Nation: Musharraf

Updated on 2004-03-30 0813

LAHORE, Pakistan : March 30 (PNS) - President General Pervez Musharraf on Monday said that Pakistan possessed all the Potential to rise as a developed nation of the world and realize its rightful place in the comity of nations.

Addressing the Garrison armed forces offices at Corps Headquarters here, he said that there was a need for putting our acts together to convert the country into a modern, progressive and dynamic Islamic welfare state. Musharraf also underscored the need for moving forward on the path of progress and avoid falling into the pitfalls around us.

He said that Islam was being wrongly projected as a religion of extremism, fundamentalism and intolerance and added that Pakistan had an important role to play in dispelling such global misconceptions about the great religion Islam and the country. The President said that a handful of extremists would not be allowed to play with the fate of this country.

He reiterated that measures were being taken to apprehend these extremists and the few people harbouring and providing them sanctuary. The President also spoke about the steps taken for economic revival, good governance and poverty alleviation within a short time span of only four years. He said that a comprehensive strategy had been evolved to restructure the armed forces on modern lines taking into consideration the requirements of all three services.

Earlier, on his arrival at the Corps Headquarters, President Pervez Musharraf was received by Corps Commander, Lieutenant General Shahid Aziz, who then introduced the officers of the Corps to him. Later, the President met the Corps Commander in his office and discussed matters of professional interest.

http://www.paknews.com/top.php?id=1&date1=2004-03-30

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Speedy Development Of Petroleum Sector Playing
Key Role For Reducing Unemployment

Updated on 2004-03-30 09:37:28

ISLAMABAD, Pakistan : March 30 (PNS) - Minister for Petroleum and Natural Resources, Ch. Nouraiz Shakoor Monday said that government is according top priority for the speedy development of petroleum sector as it played a vital role for reducing unemployment and poverty in the country.

He stated this while talking to a delegation of businessmen which called on him to discuss matters pertaining to investment opportunities in the oil and gas sector. The Minister said as result of continuation of policies and concrete steps taken by the government, a sizeable investment was attracted in the oil, gas and mineral sector during the last one and a half year.

"This investment not only helped the government to repay the foreign debts but also put the country on the road to self-reliance," he added. About facilities for potential investors, he said Government would continue to provide maximum facilities and cooperation to them in the oil and gas exploration activities both in the off-shore And on-shore areas. Nouraiz Shakoor said there has been a speedy growth of CNG industry in the country for the last couple of years which brought in an unprecedented investment in this sector.

More than 450 CNG stations have been set up in the country And over 400,000 vehicles are running on CNG fuel he said and added, this figure would go double in next few years. The Minister informed that an additional one billion cubic feet gas is now available in Pakistan. He said the government is encouraging conversion of power plants from furnace oil to gas and invited the investors to take benefit from the incentives being offered by the present government in this sector. Nouraiz Shakoor informed that US$ 3.5 billion are being Spent on oil import every year. Switching over from furnace oil to gas would save US$ 700 million per anum, he added. He further informed that import of furnace oil has been stopped from July 2003.

http://www.paknews.com/flash.php?id=8&date1=2004-03-30

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IT Minister Assures Full Assistance For ITCN-Asia 2004

Updated on 2004-03-30 102:34

KARACHI, Pakistan : March 30 (PNS) - Federal Minister for Information Technology and Telecommunication, Awais Ahmed Khan Leghari has assured all possible assistance on behalf of his Ministry as well as that of Pakistan Software Export Board (PSEB) to make the ITCN Asia 2004 a big success.

This was announced by organisers of the event in a statement here on Monday. They said the ITCN Asia 2004 is scheduled to be held at the Expo Centre Karachi from August 9 to 11. The statement further said that the Minister also informed The organizers that he has already instructed the officials of the PSEB to provide every possible assistance to the ITCN Asia Secretariat.

It was stated that the PSEB would motivate the local Software houses to participate in the event and display the capabilities of the Pakistani software industry internationally. ITCN Asia 2004 is being organised by the Ministry of Privatization in collaboration with the Ministry of Information Technology and Telecommunication, the Government of Sindh, Ecommerce Gateway Singapore, CommerceNet Singapore, Jamal's Yellow Pages of Pakistan and the City District Government Karachi.

http://www.paknews.com/flash.php?id=10&date1=2004-03-30

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UN Convoy Appriciates Pakistan’s Efforts To Revive Economy

Updated on 2004-03-29 09:22:56

ISLAMABAD, Pakistan : March 29 (PNS) - The Special Envoy of UN Secretary General for Asia Dr. Nafis Sadiq has appreciated Pakistan's efforts to revive the national economy.

Talking to APP in Beijing she hoped it would help achieve the socio-economic targets set by the world body.

http://www.paknews.com/flash.php?id=7&date1=2004-03-29

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Britain okays Pak rice, rejects Indian Pusa

By Rizwan Razi

LAHORE: British rice importers have accepted 51 varieties of Pakistani rice and rejected three Indian varieties from approved list.

Sources disclosed here on Monday that Pusa variety is the largest exported rice the world over in the name of Basmati by Indian exporters, which has been removed from the list.

A meeting of British rice importers, held on March 17, accepted all 51 varieties presented by the Rice Research Institute (RRI), Kala Shah Kaku, as ‘Basmati’.

However, DNA testing has pushed the Indian Basmati rice variety of ‘Pusa’ out of the approved list, thus decreasing competition for Pakistani produce in the British as well as European market.

Grain and Food Traders Association (GAFTA) of United Kingdom - a group of British rice importers - has accepted all 51 traditional varieties of rice while pushing at least three Indian varieties including renowned Pusa variety out of the approved varieties.

The sources said that despite frequent requests from the committee, the Indian exporters could not provide samples for DNA testing. Yet the tests of the available variety proved that Indian variety Tarori had the same feature of Pakistani variety ‘Super fine’. Similarly, Indian variety Dera Doon has the same feature of Pakistani variety Kernal.

The meeting was attended by all the stakeholders from the private sector. The sources claimed that it was a private sector’s meeting and governments of any of these three countries - UK, India and Pakistan - were not invited. Therefore, Indian government’s representatives decided not to sit in the meeting.

The Rice Exporters Association of Pakistan (REAP) was represented by its president Barrister Syed Najaf Shah.

GAFTA Code, which would govern the import and trade of rice in UK and may be followed by the European Union (EU), will be prepared by Food Standard Agency (FSA) along with GAFTA in consultation with REAP and All India Rice Exporters Association (AIREA).

Pakistan government contingent included Tariq Puri, Vice Chairman, Export Promotion Bureau (EPB); Anjum Bashir, Commercial Councillor, Pakistan High Commission, London; Muhammad Mushtaq Chaudhry, Director (RRI) Kala Shah Kaku; Zahid W. Khawaja, Brown Rice Exporter and Faisal Hassan Brown Rice Exporter from Pakistan.

The meeting considered the record produced by RRI officials and found it authentic, which lead to acceptance of 51 varieties of Land Races of Pakistan. It was decided that the varieties, for which samples had not been provided, would be removed from the list of approved varieties from 15 to 12.

It was also accepted that the varieties, of which samples had been received by FSA, would not be subject to any further inquiry and the list would become final.

In case the quantity of broken grains was to exceed 20 to 25 per cent the product would not be permitted to be called Basmati.

Inclusion of 51 heritage land races (HLR), which includes Basmati 370 and 6 other varieties Kernal Basmati, plus 5 Indian varieties including Basmati 217, Basmati 386, Deradun Type 3, Ranbir Basmati (IET 11348) and Taraori (Karnel Local, HBC-19). The said 6 varieties including Karnel Basmati are not accepted as HLR. However, it was conceded that they could parent new varieties.

We agreed to provide any further documentation required by FSA on the issue of 51 HLR.

jang.co.pk

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PTCL to launch model call and tele-shops next month

Payphone operators criticise the move

By Imran Ayub

KARACHI: Pakistan Telecommunication Company Limited (PTCL) plans to launch model call and tele-shops next month in ten major cities of the country - the move facing much criticism from payphone operators who foresee it as a threat to their business.

The state-owned telecom, entering for the first time into prepaid payphone business, has initially decided to initiate service in ten major cities, but has vowed to expand it throughout the country.

"We are initially launching the service in ten major cities but would later expand it to others," said Mashkoor Hussain, Executive Vice President Business Development PTCL.

"The total number (of model call and tele-shops) has not been decided yet. But it would grow in the days to come," he added. The only objective behind the services was to provide a facility to the common people, he added.

The planned ten cities are: Karachi, Lahore, Islamabad, Quetta, Peshawar, Hyderabad, Sukkur, Gujranwala, Faisalabad and Multan.

The PTCL’s announcement last month to open tele-shops had raised a storm of criticism. Over 400,000 people, directly associated with the payphone network, fear the implementation of the plan would affect their business.

"There are thousands of payphone networks operating in the country spread over both urban and rural areas with massive investment of millions of rupees," said Humayun Nabi Jan, President Association of Card Payphone Operators.

He said besides providing employment opportunities in the country, the ancillary industry brings over Rs6 billion annual revenue to the PTCL and contributes Rs1.8 billion to the national exchequer in the form of taxes.

Over the last few years, the payphone network has registered sharp growth. The network is also operating in some of the far-flung areas of the country, enabling the inhabitants to easily connect to family members working and living outside their hometowns.

The Pakistan Telecommunication Authority (PTA) - the telecom regulator - claims some 145,000 payphone franchises of over 200 payphone companies are operating in the country.

"The PTCL is violating an agreement with us (card payphone operators) by allowing to set up extra-departmental public call offices (ED-PCOs) in the guise of customer service centres," said Nabi Jan. "Now this plan would bring more harm to our business," he added.

However, the PTCL rules out all the notions of payphone business operators, saying it is licensed to initiate the service and has no intention of bringing harm to any business.

"I am unable to understand why they (payphone operators) are opposing it? The PTCL wants a healthy and competitive environment which ultimately benefits consumers," said Mashkoor Hussain.

He cited the existence of over 100,000 payphone shops claiming that it shows its potential to grow. Hussain said the company had nothing to do with the licensing, as it was the job of the PTA.

"The people who are accusing the PTCL of over licensing of payphone shops, they should talk to PTA as they are the authority," he added.

jang.co.pk

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