Govt Simplifies Tax Regime For Roshan Digital Accounts: State Bank Of Pakistan
Sumaira FH Published February 16, 2021 | 11:47 PM
Based on feedback from the diaspora and SBP recommendations, the Federal Government has introduced several amendments in the Income Tax Ordinance 2001 through Tax Laws (amendment) Ordinance 2021 to make the taxation regime simple, convenient and hassle-free for Non Resident Pakistanis (NRPs) maintaining Roshan Digital Accounts (RDAs).
KARACHI, (UrduPoint / Pakistan Point News - 16th Feb, 2021 ):Based on feedback from the diaspora and SBP recommendations, the Federal Government has introduced several amendments in the Income Tax Ordinance 2001 through Tax Laws (amendment) Ordinance 2021 to make the taxation regime simple, convenient and hassle-free for Non Resident Pakistanis (NRPs) maintaining Roshan Digital Accounts (RDAs).
"The amendments simplify and reduce the tax compliance cost for the NRPs maintaining RDAs, while the NRPs investing in Naya Pakistan Certificates (NPCs) through their RDAs are already under the full and final taxation regime," a State Bank of Pakistan (SBP) news release said Tuesday.
The SBP said the amendments extended the coverage of full and final taxation regime to dividends and capital gains on shares and mutual funds investments, besides capital gains on real estate investments made through the RDAs.
"As a result, NRPs will not need to file tax returns against their income derived from investment made through RDAs under the above heads. With this removal of return filing requirements, NRPs having RDAs have also been insulated from penalties (doubling of tax rate) due to their absence from the Active Taxpayer's List (ATPL). Further, NRPs with RDAs will not be subject to tax on cash withdrawals and bank transfers that were applicable on non-filers," it added.
The SBP said while the profit on debt on RDA deposits was tax exempt, the tax rate on profits on NPCs was 10 percent for both NRPs and resident Pakistanis having declared assets abroad, and 15 percent on dividends received from mutual funds and companies (except IPPs and tax exempt companies, which were taxed at 7.5 percent and 25 percent respectively).
The capital gains on shares and mutual funds, the SBP said, were also taxed at 15 percent, the same rate that was applicable on filers. In addition, a tax of 1 percent of the value of the purchase/sale would be payable by the NRPs both at the time of purchase and sale of real estate, which will be the full and final discharge of tax liability of NRPs against capital gains on real estate investments made through RDAs, it added.
The simplification of the taxation regime was likely to give a further boost to the Roshan Digital Account scheme, which had already attracted considerable inflows from NRPs in the five months since it was launched, the SBP noted.
"The RDA is a flagship initiative of the central bank aimed at connecting overseas Pakistanis with Pakistan's banking and payment system. Looking ahead, the SBP will continue its efforts towards making the policy, regulatory, business and taxation environment around RDA investor friendly," the news release said.
Related Topics
Recent Stories
Bugti assures transporters for addressing their problems
Deputy Prime Minister and Foreign Minister, Mohammad Ishaq Dar meets foreign min ..
3 drug peddlers arrested, hashish recovered
1496,990 children given polio drops in five days: DC
Six terrorists killed, hideout busted in N Waziristan IBO: ISPR
Pakistan, Qatar agree to further expand trade, investment ties
Sindh cabinet approves Rs177.5m to strengthen, mobilize various wings of police
Faisal Karim Kundi takes oath as new KP Governor
Azad Jammu and Kashmir Prime Minister Anwaar ul Haq Chaudhry seeks more vibrant ..
Tahaffuz Manzil Foster Home providing care & support to homeless children
PCB proposes April 7 -May 20 window; tweaks in rules for HBL PSL 2025
Field hospitals now operational across Punjab: Azma Bukhari
More Stories From Pakistan
-
Anwaar urges religious scholars to play role in fostering unity, solidarity
5 hours ago -
Bugti assures transporters for addressing their problems
5 hours ago -
Deputy Prime Minister and Foreign Minister, Mohammad Ishaq Dar meets foreign minister of Egypt
5 hours ago -
3 drug peddlers arrested, hashish recovered
5 hours ago -
1496,990 children given polio drops in five days: DC
5 hours ago -
Six terrorists killed, hideout busted in N Waziristan IBO: ISPR
5 hours ago
-
Pakistan, Qatar agree to further expand trade, investment ties
5 hours ago -
Sindh cabinet approves Rs177.5m to strengthen, mobilize various wings of police
5 hours ago -
Faisal Karim Kundi takes oath as new KP Governor
5 hours ago -
Azad Jammu and Kashmir Prime Minister Anwaar ul Haq Chaudhry seeks more vibrant role of lawyers for ..
5 hours ago -
Tahaffuz Manzil Foster Home providing care & support to homeless children
5 hours ago -
Field hospitals now operational across Punjab: Azma Bukhari
5 hours ago