Karachi, May 29, 2012 (PPI-OT): The government is likely to reduce turnover tax from 1% to 0.5% in budget FY13 where, as reported in the local newspaper, FBR and the Ministry of Finance have agreed to bring down the existing turnover tax 0.5% in the upcoming budget.
According to Alfalah Securities Limited, earlier, the turnover tax was reduced from 1% to 0.5% for refineries, oil and gas marketing companies (OMCs). The FBR had also allowed an 80% rebate on payment of turnover tax by the pharmaceutical distributors, distributors of FMCGs and fertilizers. Otherwise, the rate of turnover tax was 1.0 % and was applicable as a minimum where a loss is suffered under the conditions as described under sub-section (1) of Section 113, also in the case of an association of persons or individual having an annual turnover of PkR 50 mn or above. The reduction in turnover tax would be quite positive for the business entities like textile companies which otherwise faced added tax burden.