FBR Exempts Income Tax on Profits From Govt-Backed Debt Securities

The Federal Board of Revenue (FBR) has exempted income tax on profit on debt and capital gains from debt and debt instruments approved by the Federal government, derived by any approved non-resident banking company. The FBR has amended the Seventh Schedule (rules for computation of the profits and gains of a banking company and tax payable thereon) of the Income Tax Ordinance 2001 through a notification issued on Thursday. According to the notification, in the exercise of the powers conferred by rule 10 of the Seventh Schedule to the Income Tax Ordinance, 2001, the federal government has made further amendments to the Seventh Schedule. Under the new subrule, profit on debt and capital gains from debt and debt instruments approved by the federal government shall be exempt from tax chargeable under the Income Tax Ordinance, derived by any non-resident banking company approved by the Federal government for the purpose of this sub-rule, FBR added.