Category: Business

The most important business news, explained in a young, easy to understand way. News that affects young career professionals.

  • Telecom companies block 9,000 SIMs of non-filers under FBR directive

    Telecom companies block 9,000 SIMs of non-filers under FBR directive

    Telecom operators have taken action by blocking the mobile SIMs of approximately 9,000 individuals who have not filed their taxes, following directives from the Federal Board of Revenue (FBR).

    According to a spokesperson from the FBR, this measure has been expedited, with telecom companies receiving updated data daily for the purpose of blocking SIMs.

    It has been revealed that the FBR has already provided data for around 30,000 individuals whose SIMs are earmarked for blocking.

    However, the spokesperson acknowledged that there is still a substantial number of approximately 506,671 individuals who have not filed their Income Tax Return for Tax Year 2023 but are obligated to do so.

    Initially, telecom operators were hesitant to execute this directive, citing various legal concerns. Nevertheless, they eventually consented to manually block SIMs in smaller batches.

    The FBR had issued an Income Tax General Order (ITGO) in late April, instructing the disabling of mobile phone SIMs belonging to over half a million individuals not appearing on the active taxpayer list.

    At the time of issuance, telecom companies were directed to furnish a compliance report by May 15 regarding this matter.

  • Govt announces establishment of 10 new software technology parks

    Govt announces establishment of 10 new software technology parks

    The government has announced the establishment of 10 new Software Technology Parks across the country by next year.

    This announcement was made during a briefing by the Ministry of Information Technology to a high-level meeting chaired by Prime Minister (PM) Shehbaz Sharif in Islamabad.

    In addition to the new technology parks, the meeting highlighted plans to set up 100 new e-employment centers nationwide by next year. These initiatives are part of the government’s broader strategy to boost the IT sector and create more job opportunities.

    The project for the Islamabad IT Park, which is being developed in cooperation with South Korea, is expected to be completed next year. This state-of-the-art facility will offer a range of amenities, including spaces for startups, incubation centers, banks, restaurants, and other essential services.

    Moreover, South Korea is also collaborating on an information technology park project near Jinnah International Airport in Karachi, scheduled for completion by 2027. These projects are part of an ongoing effort to expand the country’s IT infrastructure, which already includes 43 software technology parks established in 29 cities.

  • Gold prices in Pakistan dip marginally amid declining purchasing power

    Gold prices in Pakistan dip marginally amid declining purchasing power

    Gold prices in Pakistan saw a slight decline on Wednesday, with the rate for 24-karat gold falling by Rs300 to Rs248,200 per tola.

    The Karachi Sarafa Association reported that the price of 24-karat gold also decreased to Rs212,791 per 10 grammes, marking a drop of Rs236. Similarly, the price of 22-karat gold was adjusted to Rs195,059 per 10 grammes.

    This decrease in gold prices can be attributed to a significant reduction in purchasing power, with the current rate maintained at Rs4,000 below its actual cost. 

    In contrast, silver prices remained stable in the domestic market. The price for 24-karat silver was steady at Rs2,850 per tola and Rs2,443.41 per 10 grammes.

    On the global stage, international spot gold traded near $2,418.3 per ounce, down by 0.11 per cent for the day. A notable trend is emerging in China, the world’s largest consumer of gold, where bullion imports have slowed.

    April saw overseas purchases of physical gold fall to 136 tons, a 30 per cent decrease from the previous month and the lowest total for the year, as per the latest customs data.

    Meanwhile, international silver prices held near an 11-year high. The surge in silver prices is driven by increased investor interest, a favourable macroeconomic environment, and a projected fourth annual market deficit. 

    The evolving dynamics in the precious metals market reflect broader economic trends and shifting consumer behaviours globally.

  • Gold price plummets by Rs1,900 per tola in Pakistan amid global decline

    Gold price plummets by Rs1,900 per tola in Pakistan amid global decline

    Gold prices in Pakistan fell on Tuesday, reflecting a drop in international rates. The price of gold per tola in the local market declined by Rs1,900, settling at Rs248,500, according to the All Pakistan Gems and Jewellers Sarafa Association (APGJSA).

    Similarly, the price of 10 grammes of gold decreased by Rs1,630, bringing it down to Rs21,048.

    This decline comes after a significant increase on Monday, when gold prices surged by Rs2,300 per tola in Pakistan.

    Internationally, the gold rate saw a decrease on Tuesday. According to APGJSA, the global price of gold was set at $2,418 per ounce, inclusive of a $20 premium, following a $21 drop during the day.

    In contrast, silver prices remained unchanged, holding steady at Rs2,850 per tola.

    Just last month, gold prices in Pakistan reached a record high of Rs252,200 per tola, marking an all-time peak in the local market.

  • Pakistan proposes Rs300 billion cut in govt expenditures to IMF

    Pakistan proposes Rs300 billion cut in govt expenditures to IMF

    Pakistan has presented a comprehensive plan to the International Monetary Fund (IMF) aimed at reducing government expenditures by Rs300 billion in the next fiscal year, including a stringent ban on development schemes. 

    According to sources cited by ARY News, this cost-cutting strategy includes several significant measures. One of the key components is the cessation of establishing new universities by the federal government, with provincial governments expected to bear the responsibility of funding existing universities under their jurisdiction.

    Additionally, a new contributory pension scheme will be introduced for all government departments, excluding defence and police personnel. This move aligns with the IMF’s recommendation for Pakistan to overhaul its pension system.

    The sources also mentioned the possibility of a complete ban on development schemes funded by parliamentarians in the next fiscal year. Moreover, the federal government will cease funding ongoing projects that are in cooperation with provincial governments.

    Another notable measure under consideration is the elimination of positions from grade 1 to 16 that have been vacant for over a year, further contributing to the reduction in government expenditure.

    The IMF has urged Pakistani authorities to impose taxes on monthly pensions exceeding Rs100,000 as part of the stringent economic reforms required for the new loan programme. The proposed reforms also include legislation aimed at taxing wealthy pensioners to secure the financial aid.

    These proposed measures are a part of Pakistan’s efforts to meet the IMF’s demands and secure the much-needed financial support to stabilise its economy.

  • Pakistan and Turkey aim to boost bilateral trade to $5 billion

    Pakistan and Turkey aim to boost bilateral trade to $5 billion

    Pakistan and Turkey have committed to elevating their bilateral trade volume to $5 billion, marking a significant step in the economic partnership between the two nations. This agreement was reached during high-level talks held in Islamabad.

    The Pakistani delegation was headed by Deputy Prime Minister and Foreign Minister Mohammad Ishaq Dar, while the Turkish side was led by Foreign Minister Hakan Fidan.

    According to a statement from the Ministry of Foreign Affairs (MoFA), the discussions encompassed a review of progress on existing bilateral cooperation and an exchange of views on regional and international matters of mutual interest.

    In a joint news conference following the talks, Deputy Prime Minister Dar highlighted plans to convene the next session of the Pakistan-Turkey High-Level Strategic Cooperation Council soon. He underscored the longstanding defence collaboration between the two countries, noting, “We are working on various joint ventures and continue to support each other in defending our territorial sovereignty and combating terrorism.”

    Dar also expressed deep gratitude to Turkey for its unwavering support to the people of Indian-occupied Jammu and Kashmir, reaffirming Pakistan’s support for the legitimate struggle of the people of the Turkish Republic of Northern Cyprus. “Pakistan and Turkey are two countries but one nation,” he remarked, underlining the historical and enduring bond between the two peoples.

    Turkish Foreign Minister Hakan Fidan described Pakistan as a strategic partner whose cooperation is vital for regional peace and stability. He termed the meeting with Foreign Minister Dar as fruitful, noting that both sides are committed to strengthening their relations in trade, defence, investment, banking, science, and technology. “This is an unshakeable friendship and brotherhood rooted in history,” Fidan said, affirming Turkey’s support for Pakistan in its fight against terrorism.

    Both foreign ministers also expressed serious concerns over the situation in Gaza, calling for a permanent ceasefire and the provision of humanitarian relief to the Palestinian people.

    This renewed commitment to deepening economic and strategic ties reflects the enduring solidarity and cooperation between Pakistan and Turkey, promising a strengthened partnership in the years to come.

  • New tax measures: Pakistan aims for Rs1.3 trillion revenue

    New tax measures: Pakistan aims for Rs1.3 trillion revenue

    The upcoming budget for the fiscal year 2024-25 is set to introduce new taxation measures amounting to a hefty Rs1.3 trillion. These measures are poised to impact various sectors, with a focus on enhancing revenue generation.

    One significant aspect of the proposed measures involves heightened rates of withholding taxes on transactions conducted by non-filers.

    Additionally, there will be adjustments in tax rates pertaining to the purchase and sale of immovable properties, vehicle registration, and revisions in income tax brackets specifically targeting the salaried class.

    In response to economic dynamics, the government has tabled a proposal with the International Monetary Fund (IMF) to raise the income tax exemption threshold for the salaried class to Rs1 million. This move aims to alleviate the tax burden on this segment of taxpayers.

    According to reports from Business Recorder, there is a push to streamline the tax structure for individuals by eliminating the salaried/non-salaried categorisation and reducing the number of tax rate slabs. This proposed adjustment seeks to simplify the tax regime for greater efficiency and ease of compliance.

    Furthermore, policymakers are contemplating widening the gap between withholding tax rates for filers and non-filers of tax returns. This initiative includes plans to raise advance income tax on machinery imports by 1 percentage point, with an anticipated monthly revenue impact of Rs2 billion.

    Other proposals on the table include increasing advance income tax on raw material imports by industrial entities by 0.5 per cent, expected to yield Rs2 billion monthly.

    Similarly, there is a proposition to hike advance income tax on raw material imports by commercial importers by 1 per cent, projecting a monthly revenue gain of Rs1 billion.

    Additionally, the budgetary deliberations include plans to augment withholding tax rates on supplies and services by 1 per cent each, with estimated monthly collections of Rs1 billion and Rs1.5 billion, respectively. There is also a proposal to raise withholding tax on contracts by 1 per cent, with an anticipated monthly revenue impact of Rs1.5 billion.

    Lastly, the government is contemplating increasing withholding tax on cash withdrawals from banks by non-filers from 0.6 per cent to 0.9 per cent, aiming to incentivise tax compliance among this demographic.

    These proposed taxation measures underscore the government’s commitment to bolster revenue streams and ensure fiscal sustainability in the face of evolving economic challenges.

  • Govt plans to revise solar net metering policy amid power sector losses

    Govt plans to revise solar net metering policy amid power sector losses

    The federal government has announced plans to revise Pakistan’s solar net metering policy, aiming to reduce losses within the power sector. This announcement was made by Federal Minister for Energy, Sardar Awais Ahmad Leghari, during a press conference where he highlighted current issues surrounding solar net metering.

    Minister Leghari noted that citizens installing solar systems initially expected to recover their investments within three years. However, due to recent advancements, this period has been significantly reduced to just one to one and a half years. This rapid return on investment underscores the growing efficiency and popularity of solar energy solutions.

    The PML-N-led government had initially promoted solarisation in 2017, resulting in 113,000 connections currently operating under the net metering scheme. Leghari reassured that while the government is open to revising the solar net metering policy if necessary, it remains committed to sustaining the programme.

    “We will take effective measures to eliminate power theft and thereby reduce the financial burden on the national exchequer,” he stated, emphasising the government’s dual focus on promoting clean energy and maintaining economic stability.

    The government is also assessing the impacts of the increasing trend towards rooftop-generated electricity. Minister Leghari explained that this assessment would help determine the rate of return on investments in solar equipment and understand the broader implications of this shift.

    He highlighted the need to analyse whether the growing reliance on solar panels is leading to inflated electricity prices for local households. “We will be involved in analysing and balancing the solar net metering,” Leghari added, indicating a comprehensive approach to ensuring the policy benefits all stakeholders.

    Net metering, a billing mechanism that credits solar energy system owners for the electricity they add to the grid, remains a pivotal aspect of the government’s strategy to encourage renewable energy adoption. This revision aims to optimise its benefits and address emerging challenges within the power sector.

  • IMF team engages in talks with Pakistan for new $8 billion programme

    IMF team engages in talks with Pakistan for new $8 billion programme

    The International Monetary Fund (IMF) confirmed that it is in discussions with Pakistan regarding a 24th bailout programme under the Extended Fund Facility (EFF), signalling a significant development in the country’s ongoing economic negotiations.

    IMF Communication Director Julie Kozack, during a press briefing, refrained from commenting directly on the status of a staff-level agreement, suggesting that the talks are still in progress.

    She stated, “A mission team led by Nathan Porter is currently meeting with Pakistani authorities to discuss the next phase of our engagement.”

    Kozack elaborated on recent IMF activities in Pakistan, noting that on April 29th, the IMF Executive Board completed the second review of the stand-by arrangement for Pakistan, enabling a disbursement of approximately $1.1 billion.

    “The completion of this review reflects the authorities’ robust policy efforts during the stand-by arrangement, which contributed to stabilising the economy,” she explained.

    Addressing further queries, Kozack indicated that the mission is actively working on the ground and that their findings would be communicated upon the mission’s completion. 

    Pakistan is seeking a substantial $6 to $8 billion bailout package from the IMF over a three- to four-year period to address its financial difficulties.

    The IMF’s technical team arrived in Pakistan on May 10 to engage in discussions regarding the new loan programme and budget preparations.

    These talks come at a critical time for Pakistan, which is grappling with considerable economic challenges, including the failure of a tax amnesty scheme proposed by the IMF. The outcome of these negotiations will be pivotal in determining Pakistan’s economic stability and future financial policies.

  • Weekly inflation eases as tomato and onion prices drop

    Weekly inflation eases as tomato and onion prices drop

    According to data released by the Pakistan Bureau of Statistics (PBS), the SPI for the week ending on May 16, 2024, showed a decline of -1.06 per cent compared to the previous week. However, in a year-on-year comparison, the SPI surged by 21.22 per cent compared to the same period last year.

    The Combined Index, a key metric monitored by economists and consumers alike, stood at 309.25, indicating a decrease from 312.56 recorded a week earlier. This contrasts with the index of 255.12 registered during the corresponding period last year.

    Among the 51 items tracked, prices exhibited mixed trends, with 39.22 per cent of items experiencing an increase, 31.37 per cent witnessing a decrease, and 29.41 per cent remaining stable.

    Notable decreases were observed in the prices of tomatoes (31.18 per cent), onions (21.84 per cent), garlic (7.76 per cent), wheat (5.48 per cent), and petrol (5.32 per cent). Conversely, significant increases were noted in the prices of cooked daal (1.96 per cent), shirting (1.74 per cent), potatoes (1.46 per cent), beef (1.11 per cent), and mutton (1.04 per cent).

    Analysis of the weekly SPI percentage change across income groups revealed a uniform decrease, ranging between -1.02 per cent and -1.17 per cent. The lowest income group experienced the most significant weekly fall at 1.17 per cent, while the highest income group recorded a decline of 1.06 per cent.

    On an annual basis, SPI trends across income segments indicated increases ranging between 14.54 per cent and 24.58 per cent. The lowest income group saw a 14.54 per cent increase in the yearly SPI, while the highest income group experienced a 19.07 per cent rise.