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SECP Submits 7 Proposals to FBR Seeking Rationalizing Taxes in the Corporate Sector

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The Securities and Exchange Commission of Pakistan (SECP) has submitted seven proposals to the Federal Board of Revenue (FBR). The proposals seek to rationalize taxes in the finance bill that is yet to come. They also focus on the growth of the non-bank financial market along with the development of the corporate sector.

These proposals would also help the government implement its tax reforms that come under Capital Market Development Plan and Future Roadmap 2020-27. Other than that the proposals also provide a suitable environment for the private funds.

“These sophisticated market participants will eventually act as a source of sizable tax revenue once industry reaches a level of maturity,” the SECP has added.

SECP also proposed that the tax credit to be extended to the latest portfolio product of Exchange Traded Funds (ETFs). Moreover, the tax rate of the ETF should be that equal to that of mutual funds.

SECP Issues Guidelines for Mutual Fund Digital Platforms. Read more here

The SECP has also demanded the FBR to assist the regulated commodity market for the trading electronic warehouse receipts. This can be achieved by exempting the physical settlement of commodity futures contracts. The proposal will help to improve the agricultural landscape, enhance financial inclusion, and help to transform the storage and handling standards during the post-harvest season. The introduction of electronic warehouse receipts will eventually help in developing the ecosystem. They will also help to improve trading, preserving, storing facilities in the agricultural sector.

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