ISLAMABAD, Sept 27: Federal Board of Revenue (FBR) has exempted the Asian Development Bank (ADB) from payment of all taxes, including payment and collection of withholding taxes.

The decision was taken through a notification SRO1012 of 2008 by amending the Second Schedule to the income tax ordinance 2001.

The exemption was already being enjoyed by the ADB under a proviso to section 54 of the Income Tax Ordinance, 2001. However, the proviso was withdrawn following an amendment made through the Finance Act, 2008, leaving no cushion or protection to the ADB income from levy of taxes effective from tax year 2009 and onwards.

An official statement issued here said the ADP, however, took up the matter with the ministry of finance, requesting continuation of exemption to the bank as allowed earlier on under Article 56 of the Asian Development Bank Ordinance, 1971, which deals with the implementation of international agreements for establishment and operation of the bank and protects the bank’s income from levy of all taxes, including payment and collection of withholding taxes.