News
Sunday, June 27, 2010
10% WHT on commercial power consumers from July 1* Industrial consumers to pay 5% WHT on monthly bills
By Sajid Chaudhry
ISLAMABAD: Through an amendment in the 2010-11 budget, the federal government has imposed a 10 percent withholding tax on monthly electricity bills of commercial consumers from July 1, while the tax rate for industrial consumers will be 5 percent.
Earlier, when the finance bill was presented in the National Assembly on June 5, the government had proposed a 5 percent withholding tax for both industrial and commercial electricity consumers.
However, the amended bill approved by the NA has imposed a 10 percent withholding tax on commercial consumers.
Prior to the 2010-2011 budget, the withholding tax was collected along with the monthly electricity bills of commercial and industrial consumers in 12 categories based on the total amount of the bill.
The tax was levied at a fixed rate ranging from Rs 60 to Rs 1,500 on monthly bills amounting to Rs 20,000.
A 10 percent tax was collected on electricity bills exceeding Rs 20,000 per month. The tax rate was adjustable for registered companies, while for other entities Rs 30,000 was the minimum amount that could be taxed.
When the finance bill was presented, the industrial sector voiced its opposition to the proposed withholding tax on electricity bills. Manufacturers claimed that the tax would increase their production prices.
In order to provide relief to the industrial sector, the government has decided to increase the withholding tax on commercial consumers. Over 6,600 industrial taxpayers are expected to benefit from the relief measure.
Courtesy www.dailytimes.com.pk