THE PUNJAB FINANCE ACT, 2012
( XLI OF 2012)
[25th June, 2012]
An
Act
to amend certain laws relating to taxes and
duties in the Punjab.
Preamble.–
Whereas, it is expedient to amend certain laws relating to tax and duties in
the Punjab and connected matters; It is enacted as follows:
1.
Short title,
extent and commencement.– (1) This Act may be cited as the Punjab Finance
Act, 2012.
(2)
It extends to whole of the Punjab.
(3)
It shall come into force on the first day of July 2012.
2.
Amendment in
Act II of 1899.– In the Stamp
Act, 1899 (II of 1899):
(a)
in section 27-A, in sub-section (1), for the expression
“Articles 23, 31 or 33”, the expression “Articles 23, 27-A, 31 or 33” shall be
substituted; and
(b)
in Schedule I, in Article 45, in column 3, after the
proviso, the following Exception shall be inserted:
“Exception.– Notwithstanding anything contained herein, a fixed
stamp duty of five hundred rupees shall be charged in respect of an instrument
of partition relating to an urban or rural property including agricultural
land, which is partly or wholly based on opening of inheritance.”
3.
Amendment in
Act V of 1958.– In the Punjab
Urban Immovable Property Tax Act, 1958 (V
of 1958):
(a)
in section 2, for clause (h), the following shall be
substituted:
“(h) “tax” means
the tax leviable under the Act and includes the late payment surcharge in terms
of section 12;”
(b)
in section 3, in subsection (5), for the expression “31st
day of August”, the expression “30th day of September” shall be substituted; (c)
for section 12, the following shall be substituted:
“12. Payment of Tax and late payment surcharge.- (1) Subject to
subsection (2), the tax shall be paid on yearly basis on or before 30th
day of September of the year for which the tax pertains.
(2)
The Government may, by notification in the official
Gazette, direct that the tax in any rating area for any specified period shall
be paid separately.
(3)
In addition to the proceedings for the recovery of the
tax under this Act, a late payment surcharge at the rate of one per cent of the
gross payable tax shall stand imposed on the first day of every month of delay
if the tax payable for any year is not paid by 30th day of
September of the said year:
Provided the late
payment surcharge on the arrears of tax as on 30th day of June
2012 shall stand levied on and from 1st day of July 2012.”;
and
(d) in section
16, after the expression “section 3”, wherever occur, the expression “or the
late payment surcharge levied under section 12” shall be inserted.
4.
Amendment in
Act XXXII of 1958.– In the
Punjab Motor Vehicles Taxation Act, 1958 (
XXXII of 1958):
(a)
in section 3, in sub-section (1), in the last proviso,
after the word “cabin”, the words “or a motor vehicle (motor car or jeep) up to
1000 CC” shall be inserted; and
(b)
in the Schedule, in
Sr.No. 4:
(i)
in column No.2, in para (b), for the entry at (i), the
following shall be substituted:
“(i) A lump sum
tax of rupees ten thousand shall be charged for motorcars and jeeps up to
1000cc at the time of registration:
Provided that in case of a motor
vehicle registered before 1st day of July 2012, the amount of tax already
paid shall be deducted from the payable tax of rupees ten thousand and the
remaining amount shall be paid lump sum at the time of payment of the tax
due.”; and
(ii)
in column No.3, the expression “Rs.600/- per annum”
shall be omitted.
5.
Amendment in
Act XV of 1977: In the Punjab
Finance Act 1977 (XV of 1977), in the
Second Schedule, at S.No.1, in
colum 2, for the expression “Companies registered under Companies Ordinance,
1984 with paid up capital–“, the expression “Companies registered under the
Companies Ordinance, 1984, modarabas,
mutual funds or any other bodies corporate with the paid-up capital or, as the
case may be, the reserves in the preceding year–“ shall be substituted.
6.
Amendment in
Act XV of 2010.– In the Punjab
Finance Act 2010 (VI of 2010), for
section 6, the following shall be substituted:
“6. Capital value tax
on immovable property.– (1) This section shall have effect notwithstanding
anything contained in any other law.
(2) For purposes of this section:
(a)
“association of persons” includes a firm, a Hindu
undivided family, a juridical person and a body of persons formed under a
foreign law, but does not include a company;
(b)
“Board of Revenue” means the Board of Revenue
established under the Punjab Board of Revenue Act, 1957 (XI of 1957);
(c)
“Collector” means the Collector of the district
appointed under the
Punjab Land Revenue Act, 1967 (XVII of 1967) and includes the
Collector of a subdivision or any other officer specially empowered by the
Board of Revenue to exercise and perform the functions of Collector;
(d)
“company” means–
(i) a
company as defined in the Companies Ordinance, 1984
(XLVII of 1984);
(ii)
a body corporate formed by or under any law in
Pakistan;
(iii)
a modarba;
(iv)
a body incorporated by or under the law of a country
outside Pakistan relating to incorporation of companies;
(v)
a trust, a co-operative society or a finance society or
any other society established or constituted by or under any law;
(vi)
a foreign association, whether incorporated or not,
which the Government has, by general or special order, declared to be a company
for purposes of this section.
(e) “Government” means Government
of the Punjab; (f) “person” includes– (i) an individual;
(ii)
an association of persons;
(iii)
a company;
(iv)
a foreign government;
(v)
a political subdivision of foreign government; and
(vi)
a public international organization;
(g)
“recorded value” means the value declared by the
transferee in the instrument, provided that the declared value of the property
shall not be less than the value specified in the valuation table notified by
the Collector of the district;
(h)
“registration authority” includes the person
responsible for registering or attesting or recording the transfer of an
immovable property or of the right to use an immovable property for more than
twenty years, and in the case of a cooperative society or a private housing
society, its principal officers including president, secretary, accountant or
any similar officer declared by the Collector as the principal officer of the
society;
(i)
“tax” means capital value tax and includes any penalty,
fee, and charge or any sum or amount leviable or payable under this section;
(j)
“urban area” means an area which is –
(i)
a rating area under the Punjab Urban Immovable Property
Tax Act, 1958 (V of 1958) except the
area where the rate of tax is zero in terms of section 117 of the Punjab Local
Government Ordinance, 2001 (XIII of 2001);
or
(ii)
an area notified by the Board of Revenue in the
official Gazette.
(3)
A tax on the capital value of an immovable property
shall be payable by a person who acquires an immovable property by purchase,
gift, exchange or power of attorney, surrender or relinquishment of right by
the owner or a right to use thereof for twenty years or more or renewal of
lease so that the total period of lease in favour of the same lessee is twenty
years or more at the rates specified in subsection (5).
(4)
The tax shall not be payable if -
(a)
immovable property is acquired through inheritance; or
(b)
immovable property is acquired through gift between
spouses, father, mother, son, daughter, grandparents and grandchildren,
siblings, or from one wife or widow to another wife or widow of the same
husband; or
(c)
power of attorney is executed between spouses or from one
wife or widow to another wife or widow of the same husband, or father, mother,
son, daughter, grandparents, grandchildren and siblings.
(5) The rate of tax in respect of immovable property is as
under:
(a)
Immovable property other than commercial or industrial
property, plaza or multi-storeyed building situated in urban area measuring at
least two hundred and fifty square yards or ten marla, whichever is less:
No. Description Rate
of tax
(i)
Where the value of the Two
percent of the
immovable property is recorded.
recorded value of the landed area.
(ii)
Where the value of the One
hundred rupees per
immovable property is not square
feet of the landed recorded. area.
(iii)
Where the immovable property is Ten rupees per square a
constructed property. feet of the constructed area in addition to the value
worked out above.
(b)
Commercial or industrial immovable property other than
plaza or multistoreyed building of any size situated in an urban area:
No. Description Rate
of tax
(i)
Where the value of the Two per cent of the
immovable
property is recorded. recorded value of the landed area.
(ii)
Where the value of the One
hundred rupees per
immovable property is square feet of the landed not
recorded. area.
(iii)
Where the immovable Ten rupees per square property is a
constructed feet of the constructed property.
area in addition to the
value
worked out above.
(c)
Immovable property whether commercial, residential or
composite in plazas and multi-storeyed buildings of any size situated in an
urban area:
No.
|
Description
|
Rate of tax
|
(i)
|
Where the value of the immovable
property is recorded.
|
Two percent of the recorded value of the immovable property
or
|
one hundred rupees per square
feet of the constructed area,
(ii) Where
the value of the immovable property is not recorded.
whichever is higher.
One hundred rupees per square feet of
the constructed area of the immovable property.
(6)
The tax shall be collected at the time of registering
or attesting the transfer by the person responsible for registering or
attesting the transfer of the immovable property for which the tax is payable.
(7)
The registration authority or any other person
mentioned in subsection (6) shall submit to the Collector a monthly statement
by 10th of the succeeding month in such Form as may be
prescribed.
(8)
In case the statement mentioned in subsection (7) is
not submitted within the prescribed time, Collector of the district may impose
a penalty on the registration authority or any other person mentioned in
subsection (6) up to rupees one hundred thousand.
(9)
The Collector of the district or any authority to whom
he is subordinate, may himself or through a person or agent appointed by him
for the purpose conduct or cause to be conducted the audit of the capital value
tax including examination of accounts and records of that registration
authority or any other person mentioned in subsection (6) and may make an
assessment of the tax on the basis of such audit.
(10)
The Collector may, by notice in writing, require any
person -
(a)
to furnish to the Collector or an officer authorised by
him any information or produce any accounts, documents or computer stored
information in his possession and relevant to the tax specified in the notice;
and
(b)
to attend at such time and place as mentioned in the
notice for purposes of examining him on oath by the Collector or the authorised
officer in respect of the matters relating to the tax.
(11)
The Collector may impound any accounts or documents
produced in terms of subsection (10) and retain the documents so long as may be
deemed necessary for purposes of examination.
(12)
Where a hard copy or computer disk of information
stored on a computer is not made available as required under subsection (10),
the Collector may require production of the computer on which the information
is stored, and impound and retain the computer for such period as may be
necessary.
(13)
For purposes of this section, the Collector shall have
the same powers as are vested in a Court under the Code of Civil Procedure,
1908 (V of 1908), in respect of the
following matter:
(i)
enforcing the attendance of any person and examining
the
person on oath or affirmation;
(ii)
compelling the production of any accounts, records,
computer stored information, or computer;
(iii)
receiving evidence on affidavit; or
(iv)
issuing commissions for the examination of witnesses.
(14)
Where a registration authority or any other person
mentioned in
subsection (6) fails to -
(i)
furnish prescribed monthly statement; or
(ii)
provide information or produce documents or record in
terms of subsection (10) within the stipulated time, Collector of the district
may make an assessment of the tax on the basis of the information or material
available to him.
(15) As soon as
may be after making an assessment under subsections (9) or (14), Collector of
district shall issue the assessment order to the registration authority or any
other person, stating:
(i)
the amount of tax due;
(ii)
the time, place and manner of filing an appeal against
the assessment order.
(16)
The powers under subsection (9) or (14) shall not be
exercised after the expiry of five years from the conclusion of the financial
year to which the assessment relates.
(17)
Where the tax is not collected from the person liable
to pay it, the tax may be collected by an officer designated by the Board of
Revenue in this behalf from the said person and the provisions of the Punjab
Land Revenue Act 1967(XVII of 1967)
shall, so far as may be, apply to the collection of the tax as they apply to
the recovery of arrears of land revenue.
(18)
Where any person fails to collect the tax or having
collected fails to deposit the tax into the Government Treasury, he shall be
personally liable to pay the tax along with default surcharge at the rate of
fifteen percent per annum for the period for which such tax or part thereof
remains unpaid, and the Collector may recover it from the said person as
arrears of land revenue after giving him an opportunity of hearing.
(19)
Where at the time of recovery of tax under subsection
(18), it is established that the tax collected from the person has meanwhile
been paid by the person liable to tax, no recovery shall be made from the
person who had failed to collect the tax but the said person shall be liable to
pay default surcharge at the rate of fifteen percent per annum from the date he
failed to collect the tax to the date the tax was paid.
(20)
A person personally liable for any amount of tax under
subsection (18) as a result of failing to collect the tax shall be entitled to
recover the tax from the person from whom the tax should have been collected.
(21)
The recovery of tax under subsection (17) does not
absolve a person who failed to collect the tax from any other legal action in
relation to the failure or from a charge of default surcharge.
(22)
The order passed by an officer under this section shall
be deemed to be an order passed by a Revenue Officer under the Punjab Land
Revenue Act, 1967 (XVII of 1967).
(23)
The provisions of sections 13 and 14 of the Punjab Land
Revenue Act 1967 ( XVII of 1967) shall apply to the cases under this section.
(24)
For purposes of appeal, review or revision, an order
passed under this section shall be deemed to be an order of a Revenue Officer
within the meanings of sections 161, 162, 163 and 164 of the Punjab Land
Revenue Act 1967 (XVII of 1967).
(25)
Where the tax has been recovered from a person not
liable to pay the same or in excess of the amount actually payable, an
application may, in writing, be made to the Collector for the refund of the tax
or the excess amount.
(26)
The proceeds of the tax collected under this section
shall be credited to the Provincial Consolidated Fund under the head specified
by the Government.
(27)
The Board of Revenue may, by notification in the
official Gazette, make provisions relating to the collection and recovery of
the tax or regarding any ancillary matters.
(28)
The Government may, by notification in the official
Gazette, exempt a class of immovable property or a class of persons or a mode
of transfer of property from the levy or recovery of the tax subject to such
conditions as may be specified in the notification.
7. Amendment in Act XV
of 2011.– In the Punjab Finance
Act 2011 ( XV of 2011):
(a) in
section 6:
(i)
for subsection (1), the following shall be substituted
and shall be deemed to have always been so substituted:
“(1) This section shall have
effect, notwithstanding anything contained in any other law.
(1A) The provisions of this section shall not
apply to the rating areas in terms of the Punjab Urban Immovable Property Tax
Act, 1958 (V of 1958) where the
property tax is levied but shall apply to the rating areas which are zero rated
in terms of section 117 of the Punjab Local Government Ordinance, 2001 (XIII of 2001).”
(ii)
in subsection (2), in clause (c), the full stop shall
be replaced by a semicolon and the following new clause shall be inserted:
“(d) “total
minimum area” means the total land area including the area under farming even
though the farm house is constructed on a portion of such area of land.”; (b)
in section 7:
(i)
in subsection (2), for clauses (b) and (c), the
following shall be substituted:
“(b) “amenities”
include facilities of sports, swimming, gymnasium, fitness, conferences,
ceremonies, musical concerts and other social amenities;
(c)
“club” means an association or organization offering
members amenities, services, meals or temporary residence with initial
membership fee of rupees two hundred thousand for any category of members and
notified as club by the Government;
(d)
“initial membership fee” includes all subscriptions or
payments, charges, donations made by an applicant for membership of the club;
(e)
“Government” means Government of the Punjab; and
(f)
“services” means all types of services provided by the
club and includes goods sold at the club premises.”
(ii)
after subsection (3), the following shall be inserted:
“(3A) Notwithstanding any
reduction of initial membership fee after the club has been notified under
subsection (2), the club shall remain notified and the cess under this section
shall continue to be levied on such club.
(3B) If a club is notified for purposes of this section, the cess
shall be levied on actual initial membership paid by the applicant.
(3C) The cess shall be levied on the services provided to
any person or a member regardless of the date of membership.”
STATEMENT OF OBJECTS AND REASONS
In order to provide
relief to taxpayers especially women in cases of partition as a result of inheritance
of property, the existing 2% ad valorem stamp duty is proposed to be replaced
by a token fixed fee of Rs.500/- only.
To facilitate
taxpayers, the Government has decided to extend the period from two months to
three months in which Urban Immovable Property Tax can be paid with a rebate of
5%. Further, in order to improve timeliness of tax deposit, it is proposed to
levy a surcharge on late payment of the tax.
To save owners of
motor vehicles up to 1000cc from the hassle of paying Token Tax every year, it
has been proposed to collect a lump sum tax at the time of registration of
vehicles. This measure will help Government provide better services to owner of
other vehicles also.
Exemption from CVT
has been granted on property transactions made through power of attorney
between blood relatives. Further, measures have been proposed to improve
compliance of the tax.
Similarly, measures have been proposed to
improve administration and compliance of Farm House Tax and Education Cess on
Clubs. Hence, this Bill.
Minister
Incharge
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