President Arif Alvi has issued the ordinance for the ‘Asset Declaration Scheme’ on Wednesday, which had been approved by the federal cabinet a day earlier.
According to the Finance Adviser Abdul Hafeez Sheikh, every Pakistani citizen except for public office holders and their dependents could avail this scheme to declare all previously undisclosed assets either abroad or in Pakistan. He added that this scheme will not be applicable to salaries but only on the expenditures and properties. He emphasized that the new scheme is aimed to record the undocumented economy.
However, proceedings or assets acquired from the commission of a criminal offense or proceedings pending in any court of law are excluded.
Under the scheme, assets within the country and abroad (except for real estate) can be whitened at a rate of four 4%. The whitened cash will have to be kept in Pakistani bank accounts. For those wanting to keep their whitened money abroad, will have to pay 6%. The scheme is valid for a period of 45 days and will expire on 30 Jun 2019.
For declaring properties, he said that value on which tax would be charged would be the market value, given that it is not less than 150% of the FBR-assigned value. The tax rate on undisclosed sales or supplies is 2%, which is offered for the first time for bringing undeclared sales into the tax net. The declared amount under the scheme will have to be submitted and retained in the bank account till 30 June 2019.
The assets declaration scheme was derived on the request of representatives of the Karachi Chamber of Commerce and Industry who met Prime Minister Imran Khan on 5 March 2019. Whereas, the scheme has induced mixed sentiments from Punjab’s business community.
