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ISLAMABAD, Aug 29: The Central Board of Revenue has notified conditions for specific exemption in case of transfer of assets on amalgamation of companies or their business or acquisition of shares.
The CBR amended the second schedule of the income tax ordinance through an income tax notification SRO885 of 2006 issued here on Tuesday.
According to the notification, in the second schedule, in Part IV, after clause (61), the following new clause shall be added, namely: (62) The following provisions of Section 97 shall not apply in case of transfer of assets on amalgamation of companies or their businesses or acquisition of shares, requiring that transferor: be resident company; and belong to a wholly-owned group of resident companies.
Provided that the transferee resident company shall own or acquire at least 75 per cent of the share capital of the transferor company or the business in Pakistan of the transferor company; the amalgamated company is a company incorporated in Pakistan; the assets of the amalgamating company or companies immediately before the amalgamation become the assets of the amalgamated company by virtue of the amalgamation, otherwise than by purchase of such assets by the amalgamated company or as a result of distribution of such assets to the amalgamated company after the winding up of the amalgamating company or companies; the liabilities of the amalgamating company or companies immediately before the amalgamation become the liabilities of the amalgamated company by virtue of the amalgamation; and the scheme of amalgamation is sanctioned by the State Bank of Pakistan, any court or authority as may be required under the law.
DUTY EXEMPTION: The CBR has withdrawn 10 per cent customs duty exemption from import of a pharmaceutical raw material, xulphamethoxzole.
The decision was taken through a customs notification SRO873 of 2006 issued here on Tuesday by amending the SRO567 of 2006.
The notification reads: “In the aforesaid notification, in Table-IV, the serial number 51 in column (1) and the entries relating thereto in columns (2), (3) and (4) shall be omitted.”
WITHHOLDING TAX: The government has exempted temporary imported goods for subsequent importation from six per cent withholding tax.
The decision was announced through an income tax notification SRO863 of 2006 released here on Tuesday by amending the second schedule of the income tax ordinance.
In the aforesaid Schedule, in Part IV, in clause (56), after sub-clause (xix), the following new sub-clause shall be added, namely: (xx) goods temporarily imported into Pakistan for subsequent exportation and which are exempt from customs duty and sales tax under Notification SRO1065 of 2005, dated October 20, 2005.
