KARACHI: Authorised dealers have issued the schedule for collecting advance income tax, different for filers and non-filers of income tax, at the time of booking of cars and jeeps.

Dealers will collect the advance income tax on behalf of their assemblers as per decision taken in the federal budget 2014-2015. The assemblers will then deposit the tax to the government’s treasury.

Pak Suzuki Motor Company (PSMCL) has issued a circular to its authorised dealers on Thursday (July 3) regarding ex-factory prices inclusive of advance income tax.

For Mehran VX and Mehran VXR, for instance, advance income tax of Rs10,000 is fixed for both filers and non-filers.

On Wagon R VX, Wagon R VXR and Wagon R VXL models, the amount of advance income tax is Rs20,000 for filers and Rs25,000 for non-filers.

The tax on Cultus VXR is Rs20,000 for filers and Rs25,000 for non-filers, and Rs50,000 and Rs100,000 on Liana RXI and Liana 1RXI.

On Swift DLX, DX STD, AT, DLX NV and AT NV, the authorised dealers will collect Rs50,000 from filers and Rs100,000 from non-filers.

Honda Atlas Pakistan will collect Rs30,000 and Rs40,000 from filers and non-filers on Honda City, and Rs50,000 and Rs100,000 on City Aspire.

On Honda Civic (all variables), Rs75,000 will be charged from filers and Rs150,000 from non-filers. A letter issued by Honda Atlas said the prices are unchanged and only above-mentioned advance tax is to be added in the prices.

Assemblers will provide the receipt of the advance income tax to the customers for adjustment of this tax in their respective income tax returns. Assemblers have asked their authorised dealers to carefully check customer’s status, that whether or not they file tax, on the website of the Federal Board of Revenue (FBR) and collect tax accordingly.

Dealers said the government’s decision might not hurt income tax filers, but this would definitely discourage investors besides helping in eroding the menace of premium on spot sales of cars.

They added that the impact of changes in withholding tax on car sales would be visible after two months in view of vast variety of buyers.

Out of total sales of locally assembled cars, the share of corporate and government buying ranges between 20 and 25 per cent, while the share of car sales through leasing is 20pc. The rest of car buyers include growers, farmers, trade community, etc.

On 1,801cc to 2,000cc, advance tax is Rs100,000 for filers and Rs200,000 for non-filers. The rate is Rs150,000 and Rs300,000 on 2001cc to 2,500cc; Rs200,000 and Rs400,000 on 2,501-3,000cc; and Rs250,000 and Rs450,000 on above 3,000cc.

Published in Dawn, July 5th, 2014