Updated: Saturday July 08, 2017/AsSabt
Shawwal 14, 1438/Sanivara
Asadha 17, 1939, at 07:36:43 PM
The
(Act XXXV of 2016)
C O N T E N T S
SECTION
HEADING
1. Short title, extent and commencement.
2. Amendment in Act II of 1899.
3. Amendment in Act V of 1958.
4. Amendment in Act X of 1958.
5. Amendment in Act XXXII of 1958.
6. Amendment in Act XIV of 1973.
7. Amendment in section 6 of Act VI of 2010.
8. Amendments in Act XLII of 2012.
9. Amendment in Act XXX of 2015.
10. Tax on imported motor cars.
[1]The
(Act XXXV of 2016)
[29 June 2016]
An Act to
levy, alter and rationalize certain taxes, fees and duties in the Punjab.
It is necessary in public interest to levy, alter and
rationalize certain taxes, fees and duties in the
Be it enacted by Provincial Assembly of the
1. Short title, extent and commencement.–(1) This Act may be cited as the Punjab Finance Act 2016.
(2) It extends to whole of the
(3) It shall come into force on the first day of July 2016.
2. Amendment in Act II of 1899. – (1) In the Stamp Act, 1899 (II of 1899):---
(a)
in section 27-A, in subsection (1), for the expression “Articles 23, 27-A, 31,
33 or 63”, the expression “Articles 23, 27-A, 31, 33, 48(b), 48(bb), 63 or
63-A” shall be substituted;
(b) in section 29:---
(i) in clause (f), the word “and” shall be
omitted;
(ii)
in clause (g), for the full stop, a semi colon shall be inserted; and
(iii)
after clause (g), as amended, the following new clauses (h), (i), (j) and (k)
shall be inserted:
“(h) in the case of a contract
chargeable with stamp duty under Article 22-A of Schedule I, the stamp duty
shall be payable by the contractor in whose favour the instrument is executed;
(i) in the
case of a decree, rule of a court or an order of a court chargeable with stamp
duty under Article 27-A of Schedule I, the stamp duty shall be paid by the
beneficiary of the decree, rule or order;
(j) in the
case of a gift chargeable with stamp duty under Article 33 of Schedule I, the
stamp duty shall be paid by the person in whose favour the instrument is
executed; and
(k) in the case of
transfer of right or interest relating to an immovable property chargeable with
stamp duty under Article 63-A of Schedule I, the stamp duty shall be paid by
the person in whose favour the transfer of the right or interest relating to an
immovable property is made.”.
(2) In Schedule I, at Sr. No. 48:---
(a)
in clause (b), for the words “Three percent of the amount of the
consideration”, the words “Three percent of the amount calculated according to
the value notified by the District Collector” shall be substituted; and
(b)
in clause (bb), for the words “Twelve hundred rupees”, the following shall be
substituted:
“(a) Twelve hundred rupees in
case the Power of Attorney is executed between spouses or between one wife or
widow and another wife or widow of the same husband, or between father, mother,
son, daughter, grandparents, grandchildren or siblings; and
(b) Two percent of
the value calculated according to the value notified by the District Collector
in all other cases.”.
3.
Amendment in Act V of 1958.– In the
(a) in section 2, after clause (a), the following new clause (aa) shall be inserted:
“(aa) “buildings and lands” include vacant plots or a parcel or portion thereof having fixed boundaries intended for specific purpose including residential, commercial or industrial use;”;
(b) in section 4:---
(i) in clause (d), the following Explanation shall be inserted and shall be deemed always to have been so inserted:---
“Explanation.- The expression “buildings and lands or portions thereof” shall mean the buildings and lands or portions thereof owned by the Government or by a body owned or controlled by the Government;”;
(ii) for clause (i), the following shall be substituted:---
“(i) One residential house or vacant plot, measuring an area not exceeding five marla, used or to be used for residential purpose except a residential house or vacant plot with annual value of more than five thousand rupees situated in a part of a rating area and categorized as category-A area;”; and
(iii) after clause (i), the following clause (j) shall be inserted:---
“(j) a vacant plot whose possession is handed over to the owner for the first time and remains vacant or without construction for a period not more than two years from date of delivery of possession.
Explanation.– If possession is handed over to any owner, the period of two years shall be reckoned from that date even if the plot is transferred to a subsequent owner.”;
(c) in section 5-A, for the full stop, a colon shall be substituted and thereafter, the following proviso shall be inserted:
“Provided that the annual value of a vacant plot shall be in accordance with the valuation table notified for respective locality of the rating area.”; and
(d) after section 16, the following section 16-A shall be inserted:
“16-A. Registering authority to ensure payment of tax.– The authority responsible for registering an instrument of sale, gift or exchange of immovable property shall not register the instrument unless it is satisfied that the outstanding tax has been paid.”.
4. Amendment in Act X of 1958.– In the Punjab Entertainment Duty Act, 1958 (X of 1958), in section 3-A, in the Table, at Sr. No.2, in column 2, for the word “Circus”, the words “Circus, well of death, swings and magic shows” shall be substituted.
5.
Amendment in Act XXXII of 1958.– In the
(1) in section 3:---
(a) in subsection (1), for the full stop at the end, a colon shall be substituted and thereafter, the following provisos shall be added:
“Provided further that if so opted by the owner of a tricycle propelled by mechanical power (motor rickshaws), the tax may be paid in lump sum once for all at the rate specified in the Schedule of this Act:---
Provided further that if so opted by the owner of a motor vehicle having engine capacity exceeding 1000cc but not exceeding 1300cc, the tax may be paid in lump sum for a period of three years at the rate specified in the Schedule of this Act.”;
(b) in subsection (3), for the word “July”, the word “August” shall be substituted;
(2) in section 4, in subsection (2), in the Table, after Sr. No. 6, in columns 1 to 3, the following entries at Sr. No. 7 shall be inserted:---
|
“7. |
For periodic lump sum payment of the motor vehicle. |
At any time” |
(3) in the Schedule, at S.No.3, in clause (a), in column 3, for the expression “Rs.400/-”, the expression “Rs.400/- per annum or Rs.3,000/- lump sum once for all if so opted by the owner” shall be substituted.
6. Amendment in Act XIV of 1973. In the Punjab Finance Act, 1973 (XIV of 1973), in Second Schedule, in Serial No. 9, in clause (c), for paragraph (ii), the following shall be substituted:---
|
“(ii) exceeding 1000cc but not exceeding 1500cc (iia) exceeding 1500cc but not exceeding 2000cc |
2% of the value of the vehicle 3% of the value of the vehicle”. |
7. Amendment in section 6 of Act VI of 2010.– In the
Punjab Finance Act, 2010 (VI of 2010), in section 6:---
(a) in subsection (3), the words “or power of attorney” shall be
omitted; and
(b) in subsection (4), clause (c) shall be omitted.
8. Amendments in Act
XLII of 2012.–
In the
(a)
in section 10, subsections (4) and (5) shall be omitted;
(b)
in section 14, after subsection (2), the following subsection (3) shall be
inserted:---
“(3) Where a person or class of persons is
required to withhold or deduct full or part of the tax on the provision of any
taxable service or class of taxable services and either fails to withhold or
deduct the tax or having withheld or deducted the tax, fails to deposit the tax
in the Government treasury, such person or class of persons shall be personally
liable to pay the amount of tax to the Government in the prescribed manner.”;
(c)
for section 16, the following shall be substituted:---
“16. Deduction and adjustment of tax on inputs to
the business.– (1) A person required to pay tax under this Act shall be
entitled to deduct from the payable amount, the amount of tax payable or
already paid by him on the receipt of taxable services exclusively used in
connection with the taxable services he provides, subject to the condition that
he holds a true and valid tax invoice not older than six tax periods, showing
the amount of tax charged under the Act on the services so received, but the
Authority may disallow or subject to additional conditions may restrict such
deduction in cases or with respect to taxable services or goods specified in
section 16A or section 16B or the rules.
(2) The Authority may, subject to section 16A or section 16B or to such conditions
and restrictions as may be prescribed, allow registered persons to claim
adjustments or deductions, including refunds arising as a result thereof, in
respect of the tax paid or payable under any other law in respect of any
taxable service or goods or class of taxable services or goods used in
connection with the taxable services such persons provide.
(3) For purposes of subsection (2), the Authority may adopt the principles
or concepts laid down in such other law in respect of adjustments, deductions
or refunds including zero-rating principle.
(4) For purposes of subsections (1) and (2), the amount of tax to be deducted
or adjusted shall not include any amount of additional tax, default surcharge,
fine, penalty or fee imposed or charged under this Act or any other law.”.
(d) after
section 16, the following sections 16A and 16B shall be inserted:---
“16A. Certain transactions not admissible.– (1) Notwithstanding anything
contained in this Act or any other law for the time being in force, payment of
the tax amount for a transaction exceeding value of fifty thousand rupees,
shall be made by a crossed cheque drawn on a bank or by crossed bank draft or
crossed pay order or any other crossed banking instrument showing transfer of
the amount of the sales tax invoice in favour of the service provider from the
business bank account of the service recipient.
(2) Online transfer of payment from the
business account of service recipient to the business account of service
provider as well as payments through credit card shall be treated as
transactions through the banking channel, subject to the condition that such
transactions are verifiable from the bank statements of the respective service
recipient and the service provider.
(3) The service recipient shall not be
entitled to claim input tax credit, adjustment or deduction, or refund,
repayment or zero-rating of tax under this Act if payment for the amount is
made otherwise than in the manner prescribed in subsection (1), provided that
payment in case of a transaction on credit is transferred within one hundred
and eighty days of issuance of the tax invoice.
(4) The amount transferred in terms of
this section shall be deposited in the business bank account of the service
provider; otherwise, the service provider shall not be entitled to claim input
tax credit, adjustment or deduction, or refund, repayment or zero-rating of tax
under this Act.
Explanation.- For purposes of this section, the term “business bank account”
means a bank account utilized by the registered person for business
transactions, declared to the Authority in the prescribed manner.
16B. Tax credit not allowed.– (1) Notwithstanding anything contained in this Act or the rules, a registered person shall not be entitled to claim input tax adjustment in respect of:---
(a) capital goods (plant, machinery, equipment and others) not
exclusively useable or used in providing taxable services;
(b) goods and services already in use on which the tax is not paid,
or, where paid, the input adjustment has been taken before the commencement of
the Act or where the input related goods and services were purchased or
acquired before such commencement;
(c) utility bills not in the name of registered person with reference
to his registered premises unless evidence of consumption is produced in the
matter of such claims;
(d) the tax claimed as input tax on services where such tax amount has
not been deposited by the supplier or the service provider or where the
evidence of such payment is not produced;
(e) carry forward of the input tax adjustment relating to the period
prior to the commencement of the Act;
(f) goods and services received against false, fake, forged, flying,
untrue, unreal or unrelated invoices or against purchases from the persons
black listed or suspended by the Authority or by the Federal Board of Revenue
or by any other Provincial authority;
(g) goods and services liable to a tax rate lesser than sixteen per
cent of the charges or to a specific rate of tax not based on value when used
for providing or rendering any service;
(h) goods
and services used or consumed in a service liable to a rate of tax lesser than
the sixteen per cent of the charges or to a specific rate of tax not based on
value;
(i) vehicles including three and two wheelers;
(j) food, beverages, garments, fabrics or others and consumption on
entertainment, amusement, recreation or enjoyment;
(k) gift and giveaway;
(l) goods or
services used or to be used for any purpose other than for taxable supplies
made or to be made by him;
(m) goods
and services acquired for personal or non-business consumption;
(n) goods
and services not related to the taxable supplies made by the registered person;
(o) goods and
services in respect of which input tax adjustment is barred under the
respective federal and provincial sales tax law;
(p) sales
tax paid to the Federal Government or any other Provincial Government for
supply of goods or provision of services, if the sales tax law of the
Federation or the Province concerned does not allow adjustment of tax paid
under this Act;
(q) from the
date to be notified by the Authority, such goods and services which, at the
time of filing of return by the buyer, have not been declared by the supplier
in his return;
(r) further
tax, extra tax and value addition tax levied under the Sales Tax Act, 1990, and
the rules or notifications issued thereunder;
(s) goods
used in, or permanently attached to, immoveable property, such as building and
construction material, paints, electrical and sanitary fittings, pipes, wires,
cables, glass products and furniture, furnishings, office equipment, excluding
those directly used in the economic activity of registered persons paying sales
tax at a rate of not less than sixteen per cent; and
(t) such goods or services as are notified or specified by the
Authority to be inadmissible for input tax adjustment.
(2) No person other than a registered person shall
make any deduction or reclaim input tax in respect of taxable services made or
to be made by him.
(3) Notwithstanding anything contained in any other
law for the time being in force or any decision of any court, for purposes of
this section, no input tax credit shall be allowed to the persons who paid
fixed tax under any provisions of this Act or under the respective federal or
provincial sales tax law.”;
(e)
in section 35, after subsection (1), the following subsection (1A) shall be
inserted:---
“(1A) A statement, in the prescribed
manner, filed by a person who is only obliged to withhold or deduct tax, shall
be treated as a return of that person, provided that such a statement shall not
be a substitute for the return required to be filed by a person providing
taxable services.”;
(f)
in section 48, in subsection (2), in the Table, in S.No.2, in column 3, for the
word “five”, the word “ten” and for the word “hundred”, the words “two hundred”
shall be substituted;
(g)
in section 60, in subsection (1), in clause (b), the expression “exceeds one
million rupees, but” shall be omitted;
(h)
in section 70, in subsection (1), after the words “the officer of the
Authority”, the expression “appointed under section 39” shall be inserted;
(i)
in First Schedule, at 9809.0000, in column 2, for the word “work”, the word
“works” shall be substituted; and
(j) in Second Schedule:---
(a)
at S.No.1, in column 2, for the existing entry, the following shall be
substituted:---
“Services provided by hotels, motels, guest houses, marriage halls and lawns
(by whatever name called) including pandal and shamiana services, catering
services (including all ancillary/allied services such as floral or other
decoration, furnishing of space whether or not involving rental of equipment
and accessories) and clubs including race clubs and their membership services
including services, facilities or advantages, for a subscription or any other
amount, to their members.”;
(b)
at S.No.2:---
(i) in column 2, for the existing entry, the following shall be
substituted:
“Advertisement on television and
radio or advertisement services showcasing of any product or service in video
programmes, television programmes or motion pictures or music albums, excluding
advertisements:
(a) sponsored by an agency of the Federal or Provincial Government for
health education; or
(b) financed out of funds provided by a Government under an agreement
of foreign grant-in-aid; or
(c) conveying public service message, if telecast on television by the
World Wide Fund for Nature (WWF) or United Nations Children’s Fund (UNICEF).”;
and
(ii)
in column 3, for the existing entry, the following shall be substituted:---
"9802.1000, 9802.2000 and respective headings”;
(c)
at S.No.12:---
(i) in column 2, for the existing entry, the following shall be
substituted:---
“All kinds of advertisement
services including advertisements on hoarding boards, pole signs and sign
boards and on closed circuit TV, websites or internet, advertisements through
brand activation in any mode, advertisement on moving vehicles, aerial
advertising, advertisement through provision of space or time, or on
bill-boards, public places, buildings, conveyances, cell phones, automated
teller machines, or through offering product exclusivity in any manner.”; and
(ii) in column 3, the following shall be inserted:---
“9802.3000, 9802.5000, 9802.9000
and respective headings.”;
(d) at
S.No.14, in column 2, for the existing entry, the following shall be
substituted:---
“Construction services and services provided by contractors
of building (including water supply, gas supply and sanitary works), roads and
bridges, electrical and mechanical works (including air conditioning),
horticultural works, multi-discipline works (including turn-key projects) and
similar other works but:
EXCLUDING:---
(i) where the tax is otherwise paid by registered persons as property
developers, builders or promoters for building construction; or
(ii) where the construction work is funded under an agreement of
foreign grant-in-aid or involves construction of consular buildings; or
(iii) residential construction
projects where the covered area does not exceed 10,000 square feet for a house
and 20,000 square feet for an apartment except where construction services are
provided to construct more than one house or more than one apartment
building.”;
(e)
at S.No.15, in column 2, the words “excluding actual purchase value or
documented cost of land” shall be omitted;
(f)
at S.No.16, in column 2, for the word “work”, the word “works” shall be
substituted;
(g)
at S.No.31:---
(i) in column 2, after the words “support services”, the words
“including business auxiliary services” shall be inserted; and
(ii) in column 3, for the existing entry, the following shall be
substituted:
“9805.9200, 9805.9090 and
respective headings”
(h)
at S.No.39:---
(i) in column 2, after the words “or cleaning services”, the words
“including collection and processing of domestic waste and street cleaning
services” shall be inserted; and
(ii) in column 3, for the existing entry, the following shall be
substituted:---
“98.22, 9860.0000 and respective
headings”
(i)
at S.No.47, in column 2, after the word “conduit”, the expression “,
transmission lines” shall be inserted; and
(j) after S.No.59, in columns 1 to 4, the following new
entries 60, 61 and 62 shall be added:---
|
“60 |
Services provided by cosmetic and plastic surgeons and hair transplant services but: EXCLUDING: Services
provided to acid or burn victims. |
9847.0000 and
respective headings |
Sixteen per cent |
|
61 |
Services
provided by warehouses or depots for storage including cold storages. |
9833.0000 and
respective headings |
Sixteen
per cent |
|
62 |
Services provided
by Packers including handling and packaging services. |
9819.1400,
9833.0000, 9841.0000 and respective headings |
Sixteen
per cent” |
9.
Amendment in Act XXX of 2015.– In the
Punjab Infrastructure Development Cess Act 2015 (XXX of 2015), in section 2,
for clause (k), the following shall be substituted:---
“(k)
“value” means the value of goods being imported or exported, as determined by
an officer of customs for purposes of the Customs Act, 1969, provided that in
case of goods manufactured, produced or consumed in Pakistan, the value shall
be determined by reference to the value determined under the Sales Tax Act for
purposes of levy and payment of sales tax.”.
10. Tax on
imported motor cars.– (1) Subject to this
section, a one-time tax on the imported motor cars registered after 30 June
2016 as mentioned in column 2 of the Table shall be levied at the rate
mentioned in column 3 thereof:---
|
Sr.
No. |
Category
of imported motor car |
Rate
of Tax |
|
(a) |
Motor car with engine capacity
exceeding 1300cc but not exceeding 1500cc. |
Rs.
70,000 |
|
(b) |
Motor car with engine capacity
exceeding 1500cc but not exceeding 2000 cc. |
Rs.
150,000 |
|
(c) |
Motor car with engine capacity
exceeding 2000cc but not exceeding 2500 cc. |
Rs.
200,000 |
|
(d) |
Motor car with engine capacity
exceeding 2500cc |
Rs.
300,000 |
Explanation.- In this
section, the term “motor car” means a motor car as defined in the Provincial
Motor Vehicles Ordinance, 1965 (XIX of 1965).
(2) The Government may, by notification,
exempt any class of vehicles from the levy of the tax under this section.
(3) The tax under this section shall not
be levied on a motor car owned by the Federal Government, the Government or any
other Provincial Government.
(4) The Government may, by notification
in official Gazette, make rules to carry out purposes of this section.
[1]This Act was passed by the Punjab Assembly
on 27 June 2016; assented to by the Governor of the
Go to Index | LL. B. – I | LL. B. – II | LL. B. – III | LL. B. Directory | Home