KARACHI: The government, after amending Income Tax Ordinance 2001, has given the Federal Board of Revenue (FBR) authority to recover capital gains tax on transactions made abroad on assets located in Pakistan.
According to said an amendment introduced into Income Tax Ordinance 2001 through Finance Bill 2018, “Any gain from disposal made outside Pakistan, of an asset located in Pakistan, shall be considered as Pakistan source income.”.
The official sources said that several foreign companies avoid taxes by dealing with other foreign partners on sale purchase agreements of assets located in Pakistan. Energy and other companies are taking advantage of a lacuna in the income tax laws, they added. An official at Large Taxpayers Unit, Karachi said the loophole was addressed through the amendment into Income Tax Ordinance, 2001 that was introduced in Finance Bill 2018.
