Finance Act, 2014

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Department: Finance Department
Main Category: Acts
Specific Category Name: Finance
Year 2014
Promulgation Date: 02-07-2014
Details:

THE KHYBER PAKHTUNKHWA FINANCE ACT, 2014.

 

(KHYBER PAKHTUNKHWA ACT NO. XXV OF 2014)

 

 

CONTENTS

 

PREAMBLE

 

SECTIONS

 

1.         Short title, extent and commencement.

2.          Amendment of Act No. II of 1899.

3.         Amendment of W.P. Act No. V of 1958.

4.         Amendment of W.P. Ord. No. VIII of 1969.

5.         Amendment of Khyber Pakhtunkhwa Act No. IV of 1990.

6.         Amendment of Khyber Pakhtunkhwa Act No. I of 1995.

7.         Amendment of Khyber Pakhtunkhwa Act No. I of 1996.

8.         Amendment of Khyber Pakhtunkhwa Ordinance No. IV of 2000.

9.         Amendment of Khyber Pakhtunkhwa Act No. VIII of 2010.

10.       Amendment of Khyber Pakhtunkhwa Act No. XXI of 2013.

 


 

THE KHYBER PAKHTUNKHWA FINANCE ACT, 2014.

 

(KHYBER PAKHTUNKHWA ACT NO. XXV OF 2014)

 

[First published after having received the assent of the Governor of

 the Khyber Pakhtunkhwa in the Gazette of Khyber Pakhtunkhwa

(Extraordinary),dated the 2nd July,2014].

 

AN

ACT

to levy, continue, revise and exempt

certain taxes, fees, cess and duty in the

Province of the Khyber Pakhtunkhwa.

 

            WHEREAS it is expedient to levy, continue, revise and exempt certain taxes, fees, cess and duty in the Province of the Khyber Pakhtunkhwa;

 

It is hereby enacted as follows:

 

1.         Short title, extent and commencement.---(1) This Act may be called the Khyber Pakhtunkhwa Finance Act,  2014.

 

(2)        It shall extend to whole of the Province of the Khyber Pakhtunkhwa.

 

(3)        It shall come into force on the first day of July, 2014.

 

2.         Amendment of Act No. II of 1899.---In the Stamp Act, 1899 (Act No. II of 1899), in Schedule-I,-

 

(a)        against Article No. 4, in column No. 3, for the word “Thirty”, the word “Sixty” shall be substituted;

 

(b)        against Article No. 6(A), in column No. 3, for the figures “100” and “200”, the figures “200” and “400” shall respectively be substituted;

 

(c)        against Article No. 8-A, in column No. 3,-

 

(i)         for the words “One hundred & fifty rupees”, occurring for the second time, the words “One thousand rupees” shall be substituted; and                                          

 

(ii)        for the words “One thousand & five hundred”, the words “Two thousand and five hundred” shall be substituted;

 

(d)       against Article No. 12, in column No. 2 and 3, for the existing entries, the following shall be substituted, in the respective columns, namely:

 

2.

3.

“AWARD,-

 

(i)         that is to say, any decision in writing by an arbitrator or umpire, not being an award directing a partition, on a reference made otherwise than by an order of the Court
in the course of a
suit; and

 

(ii)        directing partition.

 

The same duty as on a Bond (No. 15), for the amount or value of the property to which the award relates as set forth in such award.

 

 

 

 

 

Rs. 50.00 for every kanal or part thereof.”;

 

 

                        (e)        against Article No. 48,-

 

(i)         in column No. 2, the existing clause (ee) shall be deleted; and

 

(ii)        in column No. 3,-

 

(a)        for the words “Two hundred rupees” and “Two hundred & fifty rupees”, the words “Three  hundred rupees” shall respectively be substituted;

 

(b)        for the words “Seven hundred & fifty rupees”, the words “Nine hundred rupees” shall be substituted; and

 

(c)        the words “One thousand rupees” shall be deleted.

 

3.         Amendment of W.P. Act No. V of 1958.---In the West Pakistan Urban Immoveable Property Tax Act, 1958 (W.P. Act No. V of 1958),-

 

(i)         for the existing Schedule-I, the Schedule specified in Appendix-I to this Act shall be substituted;

 

(ii)        in Schedule-II,-

 

(a)        after entry at S.No. 7, the following new entry shall be inserted, namely;

 

“7(A).  Service Station of vehicles, irrespective of operating in addition to other service such as filling station or otherwise shall be charged at flat rate of Rs.10,000 per annum.”;

 

(b)        in entry at S.No. 9, the words and slash “or for the establishment of mobile phone towers/ antennas” shall be deleted; and

 

(c)        after entry at S.No. 9, as so amended, the following new entry shall be added, namely:

 

“10.     Buildings and Lands used for erection of Mobile      Phone Towers shall be assessed and taxed at the rates:

 

(i)         Provincial Headquarter

 

…….   Rs.40,000 per annum;

 

(ii)        Divisional Headquarter and respective sub-urban areas

 

…….   Rs.30,000 per annum; and

(iii)       District Headquarter and respective sub-urban areas

…….   Rs.20,000 per annum.”.

 

 

4.         Amendment of W.P. Ord. No. VIII of 1969.---In the West Pakistan Shops and Establishment Ordinance, 1969 (W.P. Ord. No. VIII of 1969), in section 24,-

 

(a)        in sub-section (2), for the words and figures
“Rs. 75.00”, “Rs.100.00”, “Rs.125.00”, and “Rs.150.00”, the words and figures “Rs.200.00”, “Rs.500.00”, “Rs.1000.00” and “Rs.2000.00” shall respectively be substituted; and

 

(b)        in sub-section (6), in clauses (a), (b), (c) and (d), for the words and figures “Rs. 25.00”, “Rs. 50.00”, “Rs.75.00” and “Rs. 100.00”, the words and figures “Rs.200.00”, “Rs. 500.00”, “Rs. 1000.00” and “Rs.2000.00” shall respectively be substituted.

 

5.         Amendment of Khyber Pakhtunkhwa Act No. IV of 1990.---In the Khyber Pakhtunkhwa Finance Act 1990 (Khyber Pakhtunkhwa Act No. IV of 1990), in section 7, for the existing Table, the Table specified in Appendix-II to this Act shall be substituted.

 

6.         Amendment of Khyber Pakhtunkhwa Act No. I of 1995.---In the Khyber Pakhtunkhwa Finance Act 1995 (Khyber Pakhtunkhwa Act No I of 1995), in section 6, in sub-section (8), for the words “Five thousand” and “Two thousand”, the words “Six thousand” and “Two thousand and five hundred” shall respectively be substituted.

 

7.         Amendment of Khyber Pakhtunkhwa Act No. I of 1996.---In the Khyber Pakhtunkhwa Finance Act 1996 (Khyber Pakhtunkhwa Act No. I of 1996), in section 11, in sub-section (1), for clauses (a), (b) and (c), the following shall respectively be substituted, namely:

 

“(a)      for virginia (flu-curd, barley and dark-air-cured)           

……    Rs. 5.00 per kilogram;

 

(b)        for white patta/rustica tobacco including khaka and the roth made of main stalk (dandi) and stem of tobacco

 

……    Rs. 2.50 per kilogram; and 

 

(c)        for snuff/naswar

……    Rs. 2.00 per kilogram.”.

 

8.         Amendment of Khyber Pakhtunkhwa Ordinance No. IV of 2000.---In the Khyber Pakhtunkhwa Land Tax and Agriculture Income Tax Ordinance, 2000 (Khyber Pakhtunkhwa Ordinance No. IV of 2000), for the existing First Schedule and Second Schedule, the Schedules specified in Appendix-III to this Act shall be substituted.

 

9.         Amendment of Khyber Pakhtunkhwa Act No. VIII of 2010.---In Khyber Pakhtunkhwa Finance Act, 2010 (Act No. VIII of 2010),  in section 2, in sub-section (2), for clause (c) the following shall be substituted, namely:

 

“(c)      Commercial Immoveable property including residential flats situated in Plazas or Multi-story buildings of any size situated in an urban area:


 

S.No.

Description of property.

Rate of Tax.

(i)

Where the value of the immovable property is recorded.

2% of the recorded value of the immovable property provided that the amount of tax per Sq-ft of constructed area for floor indicated below shall not be less than:

 

Rs.8/ per Sq-ft for basement

Rs.10/ per Sq-ft for ground floor

Rs.8/ per Sq-ft for 1st floor

Rs.7.5/ per Sq-ft  for 2nd floor

Rs.7/ per Sq-ft for 3rd floor and above.

 

(ii)

Where the value of the immovable property is not recorded.

The amount of tax per Sq-ft of constructed area for floor indicated below shall be:

 

 

Rs.8/ per Sq-ft for basement

Rs.10/ per Sq-ft for ground floor

Rs.8/ per Sq-ft for 1st floor

Rs.7.5/ per Sq-ft  for 2nd floor

Rs.7/ per Sq-ft  for 3rd floor and above.”.

 

10.       Amendment of Khyber Pakhtunkhwa Act No. XXI of 2013.---In the  Khyber Pakhtunkhwa Finance Act, 2013 (Khyber Pakhtunkhwa Act No. XXI of 2013), in the First Schedule,-

 

(a)        after the existing entries against Classification No. 9802.5000, the following new Classification No. and Description shall be inserted, in the respective columns, namely:

 

“9802.6000

Advertisements on poles.

 

9802.7000

 

Advertisements on billboards.

 

9802.8000

 

Sale of Space for Advertisement services.”;

 

(b)        after the existing entries against Classification No. 9802.9000, the following new Classification No. and Description shall be inserted, in the respective columns, namely:

 

“9802.9010

TV, Radio & Production Services.

 

9802.9020

Broadcasting Services.”;

 

(c)        for the existing entry in Description column against Classification No. 9814.2000, the following shall be substituted, namely:

“Contracting services rendered by the contractors of buildings, electro-mechanical works, turn-key projects and similar other works, excluding individual house construction contracts.”;

 

(d)       after the existing entries against Classification No. 9815.6000, the following new Classification No. and Description shall be inserted, in the respective columns, namely:

 

“9815.7000

Cosmetic and Plastic Surgery Services.”;

 

(e)        after the existing entries against Classification No. 9819.8000, the following new Classification No. and Description shall be inserted, in the respective columns, namely:

 

“9819.8700

Video Tape and Production Services.”;

(f)        after the existing entries against Classification No. 9819.9500, the following new Classification No. and Description shall be inserted, in the respective columns, namely:

 

“9819.9600

Copy Right Services.;

 

9819.9800

 

Sound Record Service.”;

 

(g)        after the existing entries against Classification No. 9820.4000, the following new Classification No. and Description shall be inserted, in the respective columns, namely:

 

“9820.5000

Services provided by motor vehicle workshops, mechanic shops, air conditioning fitting service and cleaning centres.”; and

 

(h)        after the existing entries against Classification No. 9868.0000, the following new Classification No. and Description shall be added, in the respective columns, namely:

 

“9869.0000

Container terminal services.

 

9870.0000

Manpower recruitment and labour supply services.

 

9871.0000

Port operating services.

9872.0000

Public Bonded Warehouse.

 

9873.0000

Services provided in respect of mining of minerals, oil and gas including related surveys and allied activities.

 

9874.0000

Event Management Services.”.


Appendix-I

[Section 3]

 

“Schedule-I

[See Section 3(2)]

PART ‘A’

 S

No

category

Rate of tax

for areas of

Provincial HQ

as notified by

the Govt:

(per annum) @Rs.

Rate of tax

at Divisional HQ

(per annum)

@Rs.

Rate of tax in suburban areas of Div: HQ

(per annum)

      @Rs.

Rate of tax at Distt: HQs

 (per annum)

@Rs.

 

Rate of tax at district other than district HQs

(per annum)

@Rs.

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

 

 

A

B

C

Town-ships

Other than townships

Town-

ships

Other than townships

Town-ships

Other than townships

Town-ships

Other than townships

1.

Upto 5 marlas (other than self occupied)

1000

900

750

900

750

500

325

400

300

200

150

2.

Exceeding 5 marlas but not exceeding 10 marlas

 

1700

1600

1500

1600

1500

900

750

800

750

600

500

3.

Exceeding 10 marlas but not exceeding 15 marlas

 

2200

2100

2000

2100

2000

1100

1000

1100

1000

600

500

4.

Exceeding 15 marlas but not exceeding 18 marlas

3300

3200

3000

3200

3000

1700

1500

1700

1500

900

750

5.

Exceeding 18 marlas but not exceeding 20 marlas

 

10000

9000

8000

9000

8000

5000

3000

4000

2000

1500

1000

6.

Exceeding 20 marlas but not exceeding 30 marlas

15000

14000

12000

14000

10000

8000

6000

5000

3000

3000

2000

7.

Exceeding 30 marlas but not exceeding 40 marlas

 

20000

18000

16000

18000

16000

14000

12000

10000

8000

6000

4000

8.

Exceeding 40 marlas

30000

25000

20000

25000

20000

15000

12000

10000

8000

6000

4000

 

PART ‘B’

Building acquired for the use by Government, Semi-Government, Non Government Organizations, Development Financial Institutions, private commercial organizations, guest houses, hostels or by Banks shall be assessed and taxed twenty percent of the actual annual rent. In case building other than those exempted under section 4 of the Act, which are owned and occupied by such organizations, tax shall be levied on the assessed annual rental value of such buildings on the rate prescribed hereinbefore.

 

PART ‘C’

Tax on properties let out on rent, lease or other arrangement and not in use of their registered owners will be double of the above, except for the category-1 (upto 5 marlas).

Explanation:    Categorization of area in Provincial Headquarter into Category “A”, “B” or “C” shall be by way of notification by the Local Government & Rural Development Department, to be notified from time to time. In Divisional and District Headquarters, Townships are approved Townships and include those areas, which are declared so by Local Government & Rural Development Department from time to time.”.


Appendix-II

[See section 5]

 

“TABLE

 

S.No.

Description of Tax payers.

Rates of Tax

(per annum).

 

1.

2.

3.

1.

(i)         All persons engaged in any profession, trade, calling or employment, other than those specifically mentioned hereinafter, in the Khyber Pakhtunkhwa Province, whose monthly income or earning:

 

(a)        when exceeds Rs.6000 but not exceeds Rs.10000;

 

(b)        when exceeds Rs.10000 but not exceeds Rs.20000;

 

(c)        when exceeds Rs.20000 but not exceeds Rs.50000;

 

(d)       when exceeds Rs.50000 but not exceeds Rs.100000;

 

(e)        when exceeds Rs.100000 but not exceeds Rs.200000; and

 

(f)        when exceeds Rs.200000 but not exceeds Rs.500000.

 

Exempted

 

 

Rs.330

 

 

Rs.435

 

 

Rs.600

 

 

Rs.800

 

 

Rs.1000

(ii)        Employees of Federal and Provincial Government drawing pay in Basic Scales:

 

(a)        BS-01 to 04;

 

(b)        BS 05 to 12;

 

(c)        BS 13-16;

 

(d)       BS-17;

 

(e)        BS-18;

 

(f)        BS-19; and

(g)        BS-20 and above.

Exempted

 

Rs.100

 

Rs.200

 

Rs.300

 

Rs.500

 

Rs.1000

Rs.2000

2.

All limited companies, Modarbas, Mutual Funds and any other body corporate with paid up capital and reserves in the preceding year, whichever is more:

 

(a)        when not exceeding Rs.10 million;

 

(b)        when exceeding Rs.10 million but not exceeding 25 million;

 

(c)        when exceeding Rs.25 million but not exceeding 50 million;

 

(d)       when exceeding Rs.50 million but not exceeding 100 million;

 

(e)        when exceeding Rs.100 million but not exceeding 200 million; and

 

(f)        when exceeding Rs.200 million.

 

Rs.18000

 

Rs.27000

 

 

Rs.36000

 

 

Rs.90000

 

 

Rs.100000

 

 

Rs.100000

 

Explanation.---The paid up capital in case of foreign banks shall be the minimum paid up capital as determined by the State Bank of Pakistan:

 

3.

Persons, other than companies, owning factories, commercial establishments, private education institutions and private hospitals, having the following commercial establishment:

 

 

(a)        any commercial establishment/factories having 10 or more employees which have not been otherwise explicitly given in this table;

 

(b)        private clinics & hospitals having upto 10 employees;

 

(c)        private clinics, hospitals having employees more than 10 but not more than 50;

 

(d)       private clinics & hospitals having more than 50 employees;

 

(e)        private medical colleges;

 

(f)        private engineering institutes having degree programs;

 

Rs.10000

 

 

 

Rs.10000

 

 

Rs.50000

 

 

Rs.100000

 

 

Rs.100000

 

Rs.100000

 

(g)        private business education institutes:

 

(i)         having upto 100 students;

 

(ii)        exceeding 100 students.

 

(h)        private law colleges;

 

(i)         private education institutions including professional and technical institutions other than specified at e,f, g & h charging monthly fee not exceeding Rs.1000 per student;

 

(j)         private education institutions including professional and technical institutions other than specified at e,f, g & h charging monthly fee exceeding Rs.1000 but not exceeding Rs.2000 per student.

 

(k)        private education institutions including professional and technical institutions other than specified at e,f, g & h charging monthly fee exceeding Rs.2000 but not exceeding Rs.5000 per student;

 

(l)         private education institutions including professional and technical institutions other than specified at e, f, g & h charging monthly fee exceeding Rs.5000 per student.

 

 

Rs.70000

 

Rs.100000

 

Rs.100000

 

Rs.5000

 

 

 

 

Rs.7000

 

 

 

 

 

Rs. 20000

 

 

 

 

 

Rs.100000

4.

Holders of import or export license, assessed to income tax in the preceding year with annual turnover:

 

 

(a)        when not exceeding Rs.50000;

 

(b)        when exceeding Rs.50000.

Rs.4000

 

Rs.5000

 

5.

Clearing agents licensed or approved as custom house agents.

Rs.10000

6.

Travel Agents:

 

 

(a)        IATA travel agents approved;

 

(b)        Non-IATA approved;

 

(c)        Hajj and tour operator.

 

Rs.15000

 

Rs.8000

 

Rs.15000

7.

Restaurants/Guest Houses liable to sales tax.

 

Rs.15000

8.

Professional Caterers.

 

Rs.15000

9.

Wedding Halls/Lawns (irrespective of their nomenclature).

 

Rs.30000

10.

Advertisement Agencies.

 

Rs.10000

11.

Doctors:

 

 

(a)        Specialists;

 

(b)        Non Specialists including Medical Practitioners, Hakeem’s, Homeopaths etc.;

 

(c)        Dentists.

 

Rs.20000

 

Rs.2000

 

 

Rs.15000

 

12.

Diagnostic and Therapeutic Centers, including pathological and chemical laboratories:

 

 

(a)                located at Divisional Headquarters;

 

(b)        located at other places.

 

Rs.15000

 

Rs.3600

13.

Contractors, Suppliers and Consultants who, during preceding financial year supplied to the Federal or any Provincial Government or any local authority in the District, Goods, Commodities, or rendered service of the value:

 

 

(a)        when exceeding Rs.10,000 but not exceeding Rs. 0.5 million;

 

(b)        when exceeding Rs.0.5 million but not exceeding Rs.1 million;

 

(c)        when exceeding Rs.1.50 million but not exceeding Rs.2.500 million;

 

(d)       when exceeding Rs.2.500 million but not exceeding Rs.10 million;

 

(e)        when exceeding Rs.10 million but not exceeding Rs.25 million;

 

(f)        when exceeding Rs.25 million but not exceeding Rs.50 million;

 

(g)        when exceeding Rs.50 million.

 

Rs.4000

 

 

Rs.5000

 

 

Rs.7000

 

 

Rs.18000

 

 

Rs.25000

 

 

Rs.30000

 

 

Rs. 100000

14.

Petrol/Diesel/CNG filling stations.

 

Rs. 8000

15.

All establishments, including video shops, real estate shops/ agencies, card dealers, and net cafes assessed or not assessed to income tax in the preceding financial year.

 

Rs. 3000


16.

Chartered Accountants with an independent audit practice and excluding those who are employed in companies not owned by them.

 

Rs.15000

17.

Vehicles Service Stations.

 

Rs.5000

18.

Transporters/Transport companies:

 

 

(a)        within provincial headquarters limit;

 

(b)        Others.

 

Rs.3000

 

Rs.2000

19.

Member of Stock Exchange.

 

Rs.5000

20.

Money Changer:

 

 

 

(i)         within Provincial Headquarter’s limits; and

 

(ii)        Others.

 

Rs.10000

 

Rs.5000

21.

Health Fitness Centers/Gymnasium:

 

 

 

(i)         within Provincial Headquarter’s limits; and

 

(ii)        Others.

 

Rs.2000

 

Rs.1000

22.

Jewelers.

 

Rs.1000

23.

Departmental Stores.

 

Rs.1000

24.

Electronic goods Stores.

 

Rs.1000

25.

Cable Operators.

 

Rs.1000

26.

Printing Presses.

 

Rs.1000

27.

Pesticides Dealers.

 

Rs.1000

28.

Tobacco Whole Sellers.

Rs.2000”.


 

Appendix-III

[Section 8(b)]

 

“The First Schedule

(See Section 3)

 

Rates of Land Tax

 

S.No.

Kind/Area of Land

Per acre rate

 

1.

2.

3.

1.

Slab of total cultivated land, computed as Irrigated land, by treating one irrigated Acre as equal to two un-irrigated acres, excluding orchards:

 

(i)         Not exceeding 5 acres;

 

(ii)        exceeding 5 acres but not exceeding 121/2 acres; and

 

(iii)       exceeding 121/2 acres.

 

 

 

 

 

 

Exempted

 

Rs.225

 

 

Rs.340

2.

Orchard.

Rs.900

 

 


 

The Second Schedule

(See section 6)

 

Rates of Agricultural Income Tax

 

 

In the case of every owner, the agriculture income tax shall be charged on the agriculture income:

 

1.

Where income is not more than Rs.400,000/-.

 

No tax

2.

1.      Where total taxable income exceeds Rs.400,000/- but does not exceed Rs.550,000/-.

5% of amount exceeding     Rs.400,000/-.

 

3.

2.      Where total taxable income exceeds Rs.550,000/-  but does not exceed Rs.750,000/-.

3.       

Rs.7500/- plus 7.5% on amount exceeding Rs.550,000/-.

4.

 

4.      Where total taxable income exceeds Rs.750,000/- but does not exceed Rs.950,000/-.

5.       

Rs.22,500/- plus  10% on amount exceeding Rs.750,000/-.

5.

6.      Where total taxable income exceeds Rs.950,000/- but does not exceed Rs.1,100,000/-.

7.       

Rs.42,500/- plus 15% on amount exceeding Rs.950,000/-.

6.

8.      Where total taxable income exceeds Rs.1,100,000/-.

9.       

Rs.65,000/- plus17.5% on amount exceeding Rs.1,100,000/-”.