ISLAMABAD -To lure foreign investment, PTI government launches anunprecedented initiative.
Imran Khan government has decided to waive income tax and duties for thoseinvesting in eurobonds and sukuk as per its medium-term note programme(MTN).
The finance ministry has already sent a summary to the government for theexemptions citing that the Income Tax Ordinance 2001 had a provision for itin its schedule II, Gulf Times has reported.
As per clause 75 of the schedule, any international government institution,private company, firm, association of persons or resident could be giventax exemption on income or interest against any loan agreement, foreigncurrency instrument, government scheme or treasury receipts. However, asper the Rules of Business 1973, the federal government must be served witha formal request for the exemptions.
After the federal government’s approval, the Federal Board of Revenue (FBR)will issue a formal notification for the exemptions permitted, according tofinance ministry sources.
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The waiver in income tax and duties on sovereign bonds is given to attractcapital from the international financial market.As per the summary, previous governments had also exempted income tax oneurobonds and sukuk.
According to finance ministry’s spokesperson Umar Hameed, the financedivision completed the shortlisting of transaction advisers for itsone-year eurobonds and sukuk under the MTN programme on October 18.
The biddings were invited until October and after scrutiny of theapplications, the finance division appointed seven international advisersfor its sovereign bonds.
