ISLAMABAD: The Federal Board of Revenue (FBR) has imposed a 1.25% turnover tax on the subsidy provided to utility stores, ARY News reported citing sources.
According to sources, the tax will be imposed on the subsidy amounting to Rs 60 billion in the current financial year.
Sources said that the FBR will collect approximately Rs 1 billion in tax revenue from the subsidy after considering the subsidy as income.
Last year, the FBR had attached the accounts of utility stores and recovered Rs 4 billion. The imposition of tax on subsidy has been a point of contention between the FBR and utility stores, sources added.
The government has included the tax on subsidy in the current financial year’s finance bill. The 1.25% tax will be imposed on the income of loss-making companies, sources revealed.
Earlier, the Utility Stores Corporation (USC) cleared the air on the PM relief package – subsidies on five basic kitchen items.
READ: Utility Stores clear the air on PM relief package
The Utility Stores Corporation spokesperson in his statement said a summary was forwarded to the government for PM relief package.
The spokesperson also rejected the rumors of price hike at the Utility Stores and added that the package is continuing as routine for the public and the beneficiaries of the Benazir Income Support Program.
The clarification of the Utility Stores Corporation ended speculations about ending of the PM relief package.
It is pertinent to mention here that a total of Rs 65 billion were allocated for the PM’s and Ramadan packages in the budget out of which Rs 10 billion were allocated for the PM’s Ramadan Relief Package, and remaining Rs 55 billion for the PM’s Relief Package.
Additionally, Rs 35 billion were allocated under the PM’s package for the ongoing financial year.
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