ISLAMABAD: The Federal Board of Revenue (FBR) has granted exemption from withholding tax on services provided by the National Telecommunication Corporation against telecommunication services.
Through the Tax Laws Amendment Ordinance 2021, exemption has been allowed from withholding tax u/s 153(1)(b) of the Income Tax Ordinance 2001 have been extended on services provided by the NTC against telecommunication services including ancillary services specified in section 41 of the Pakistan Telecommunication (Re-organization) Act, 1996.
Currently, exemption is available on profits and gains derived by a taxpayer from a transmission line project set up in Pakistan on or after 1st July 2015, for a period of 10 years.
The exemption under this clause shall apply to such project which is (a) owned and managed by a company formed for operating the said project and registered under the Companies Ordinance, 1984 (XLVII of 1984), and having its registered office in Pakistan; (b) not formed by the splitting up, or the reconstruction or reconstitution, of a business already in existence or by transfer to a new business of any machinery or plant used in a business which was being carried on in Pakistan at any time before the commencement of the new business; and (c) owned by a company 50 percent of whose shares are not held by the federal government or provincial government or a local government or which is not controlled by the federal government or a provincial government or a local government:
The exemption under this clause was not available to projects which are set up on or after the 30th June, 2018.
Now through Ordinance, the deadline for project setup has been extended to 30th June 2022, the Ordinance added.
Copyright Business Recorder, 2021