ISLAMABAD: Federal Board of Revenue (FBR) has issued withholding tax rates on sales made by manufacturers to retailers, wholesalers and distributors during tax year 2021.
The FBR issued the withholding tax card 2020-2021 (updated up to June 30, 2020) incorporating amendment made to Income Tax Ordinance, 2001 made through Finance Act, 2020.
Under section 236G of the Ordinance, every manufacture or commercial importer of electronics sugar, cement, iron and steel products, fertilizers, motorcycles, pesticides, cigarettes glass, textile, beverages, paint or foam sector shall collect/deduct withholding tax from distributor, wholesaler and dealer at the time of sale.
Advance tax has to be collected from wholesaler, distributor and dealers at the time of sales made to them:
In case of fertilizers the withholding tax rate shall be 0.7 percent of gross amount. The tax rate shall be increased by 100 percent in csae persons are not on the Active Taxpayers List (ATL).
In case of other than fertilizers the tax rate shall be 0.1 percent of gross amount. The tax rate shall be 0.2 percent of gross amount if persons not on the ATL.
The tax withheld under this section shall be adjustable.
Under Section 236H of the Ordinance, every manufacture ,distributor, dealer, wholesaler or commercial importer of electronics, sugar, cement, iron & steel products, motorcycles, pesticides, Cigarettes glass, textile, beverages, paint or foam sector shall collect/deduct from every retailer at the time of sale.
Advance tax has to be collected from retailers at the time of sales made to them:
In case of electronics the withholding tax rate shall be 1 percent of the gross amount and the rate shall be 2 percent of gross amount if persons are not on the ATL.
The withholding tax rate under this section for others shall be 0.5 percent of gross amount and the rate shall be 1 percent in case persons are not on the ATL.
The tax collected/deducted under this section shall be adjustable.
Under Section 236HA of the Ordinance, every person selling petroleum products shall collect/deduct withholding tax from every petrol pump operator or distributor, where such operator or distributor is not allowed a commission or discount at the time of sale of such products.
Advance tax has to be collected on ex-depot sale price of such petroleum products at the rate of 0.5 percent of ex-depot sale price and the rate shall be 1 percent of ex-depot sale price.
The withholding tax collected/deducted under this section shall be final.
