Tag: revenue

  • ‘There is no choice when the company is losing $4 million per day’: Musk justifies cutting half of Twitter’s workforce

    ‘There is no choice when the company is losing $4 million per day’: Musk justifies cutting half of Twitter’s workforce

    On Friday, Twitter laid off half of its 7,500-person workforce as the company’s troubled big restructuring under new owner Elon Musk got under way, only one week after his sensational takeover.

    According to an internal memo seen by AFP, “approximately 50 per cent” of the workforce was affected and would immediately lose access to business computers and email.

    Workers from all over the world who were let go used Twitter to express their anger or disbelief and bid farewell to one of Silicon Valley’s most recognisable enterprises.

    “Woke up to the news that my time working at Twitter has come to an end. I am heartbroken. I am in denial,” said Michele Austin, Twitter’s director of public policy for the US and Canada.

    Prior to the layoffs, Twitter restricted access to all of its locations and asked staff to remain at home while they awaited word on their futures with the firm.

    The cull is a part of Musk’s effort to obtain financing for the massive $44 billion acquisition, for which he sold $15.5 billion worth of Tesla shares and took on billions of dollars in debt.

    After his massive acquisition, Musk, the CEO of Tesla and SpaceX, has been frantically looking for new revenue streams for Twitter, including the notion of charging users $8 per month for verified accounts.

    The actions would help Twitter combat the possibility of losing advertisers, which are the company’s primary source of income, since many of the major businesses in the world postpone their ad purchases after learning of Musk’s well-known contempt for content controls.

    The volatile businessman lamented a “huge loss in revenue” on Twitter on Friday, attributing it to “activist groups” who were pressing advertisers.

    “We did everything we could to appease the activists. Extremely messed up! They’re trying to destroy free speech in America,” he added.

    This seemed to be a reference to Musk’s previous meeting with civil rights organisations, where he heard worries that Twitter will unleash a wave of hate speech a week before the US midterm elections. Musk had promised that Twitter would not turn into a “free-for-all hellscape” in an effort to calm people down, but his assurance was swiftly contradicted by a tweet spreading a rumour that the husband of US House Speaker Nancy Pelosi had been attacked.

    “We are witnessing the real time destruction of one of the world’s most powerful communication systems. Elon Musk is an erratic billionaire who is dangerously unqualified to run this platform,” said Nicole Gill, Executive Director of Accountable Tech.

    She was a member of a group of 60 rights organisations that demanded on Friday that advertising on the Musk-owned platform be boycotted.

    “Elon Musk has demonstrated that it’s not possible for him to keep the brand safeguards that have existed on Twitter in place. There’s no more time for trust but verify, it’s time for escalation,” said Angelo Carusone, President and CEO of Media Matters for America.

    Although very popular with celebrities and opinion leaders, the California-based business has historically struggled to turn a profit and has lagged behind Facebook, Instagram, and TikTok in terms of user growth.

    Since Musk finalised his acquisition late last week and immediately set about dissolving its board and removing its chief executive and key managers, Twitter employees have been preparing for this kind of unpleasant news. Five Twitter employees who had previously been let go filed a class action lawsuit against the business late on Thursday, alleging that they had not received the legally mandated 60-day notice period.

    The US Worker Adjustment and Retraining Notification (WARN) Act, which grants employees the right to early notification in situations involving large layoffs or plant closures, is cited in the lawsuit.

  • Poor performance forces govt to extend income tax return filing deadline to November 30

    Poor performance forces govt to extend income tax return filing deadline to November 30

    The Federal Board of Revenue (FBR) has managed to reach its four-month target of Rs2.14 trillion despite poor performance in increasing the tax base because of a 34 per cent decrease in income tax returns filed.

    Ishaq Dar, the finance minister, was forced to once again push the deadline for filing returns due to the dismal results in increasing the tax base. The new deadline is November 30; within this time, FBR must receive an additional Rs1.3 million in returns only to match the amount from the previous year.

    The FBR collected Rs2.148 trillion in taxes, as opposed to the objective of Rs2.143 trillion set for the period of July to October, according to FBR officials. Tax revenue increased by 16 per cent, or Rs305 billion, as compared to the same period in the previous fiscal year.

    This increase was slower than the 23 per cent inflation rate that was in effect at the time. but adequate for the first four months of the fiscal year to keep the tax department on pace.

    According to Express Tribune, the FBR had taken in Rs1.84 trillion in tax revenue during the first four months of the previous fiscal year. The economy’s slowdown, however, makes it appear as though the FBR may fall short of its tax goals for the upcoming months.

    A decrease in imports was the main reason the FBR could not meet its monthly tax goal of Rs 534 billion, which it missed by Rs 22 billion. Although there was a 15 per cent increase in revenue over the Rs445 billion collected in October of last year, the monthly goal was not met.

    The Inland Revenue Service (IRS) exceeded its July–October goal, largely mitigating the effects of the Customs Department’s low collection rate.

    As long as less than 2.5 million people file income tax returns, the tax system will not be able to increase the tax base, which has shrunk by 34 per cent during the previous tax year. Up to Rs3.8 million worth of returns have been submitted for the 2021 tax year.

    By extending the tax base to include traders, Pakistan had promised the International Monetary Fund (IMF) that it would increase the tax base by a minimum of 700,000. Instead, it is approximately Rs1.3 million below the total from the prior year. The FBR’s base really falls two million short of its own conservative goal.

  • FBR must collect Rs120 billion in two days to meet monthly target of Rs684 billion

    To reach its monthly goal of Rs684 billion by the end of the current month, the Federal Board of Revenue (FBR) must collect approximately Rs120 billion in the final two days of September.

    The FBR’s preliminary revenue collection as of September 2022 was over Rs565 billion compared to the target of Rs684 billion, representing a shortfall of over Rs119 billion.

    To reach the monthly goal of Rs684 billion, the FBR needed to collect about Rs60 billion every day during the final two days of September 2022, according to Brecorder.

    The government would be forced to implement emergency collection measures, such as imposing a sales tax on petroleum items, if the FBR is unable to meet the monthly target of Rs684 billion. To avoid taking emergency revenue measures, the FBR has increased efforts to reach the desired revenue collection objective.

    The tax collecting system currently has a difficult task ahead of it: achieving the assigned revenue collection target of Rs684 billion in September 2022.

    In order to maximise revenue collection, tax authorities have developed a plan in conjunction with the chief commissioners of the LTOs and heads of MTUs.

    The final day to pay advance tax instalments was September 25, and the majority of the corporate sector had already paid their owed advance tax instalment by that date.

    The FBR examined the big tax offices’ and medium tax offices’ revenue results via the video link. The meeting also covered the potential reduction in income collection under a few heads as a result of the severe floods.

    In comparison to the target of Rs483 billion, the FBR had tentatively collected net revenue of Rs489 billion for August 2022, representing an increase of Rs6 billion.

    In comparison to the set revenue collection target of Rs926 billion during the first two months of July and August in 2022–2023, the FBR has collected Rs948 billion. The Board has so far surpassed the specified target in the current fiscal year 2022–2023 by Rs22 billion.

    The FBR collected net revenue of Rs489 billion during August 2022, exceeding the objective of Rs483 billion compared to Rs448 billion collected during the same period last year, according to provisional figures.

  • Pak Suzuki suffers losses of Rs17.23 million due to rising production costs

    Pak Suzuki suffers losses of Rs17.23 million due to rising production costs

    Pak Suzuki Motor Company Ltd. (PSMC) reported its half-yearly results, which were completed on June 30, 2022. The company reported a net loss of Rs17.23 million against a net profit of Rs1.19 billion, according to the automaker’s latest filing on the Pakistan Stock Exchange (PSX).

    According to Mettis Global, the company’s sales revenue climbed 30 per cent YoY, from Rs66 billion to Rs112, 62 billion, mostly due to volumetric growth and pricing increases.

    As a result of growing input costs and the significant depreciation of the local currency, the gross margins during 1HFY22 decreased from 5.98 per cent to 3.74 per cent.

    Regarding the company’s primary expense heads, distribution and marketing costs came in at Rs1.64 billion, up 30 per cent YoY, while administration costs dipped to Rs1.48 billion, up 11 per cent YoY.

    In contrast to Rs866 millionn in 1HFY21, the company additionally received Rs1.56 billion in other income.

    Furthermore, as a result of rising interest rates, finance costs increased by 6.2x YoY, from Rs292 million to Rs1.8 billion.

    The company also paid Rs767.84 million in taxes, which represents an increase of 57 per cent YoY because of the impact of super taxes.

  • US firm to buy Pakistan’s Cloudways for $350 million

    US firm to buy Pakistan’s Cloudways for $350 million

    Cloudways, a Pakistani company that offers small and medium-sized businesses cloud hosting and software as a service (SaaS) capabilities, will be acquired by New York Stock Exchange-listed company DigitalOcean Holdings for $350 million.

    A large amount of the consideration, according to a business statement posted on Wednesday, would be paid over a 30-month period after the transaction closes in September.

    According to DAWN, this will be one of the largest acquisitions in Pakistan’s history due to the hefty amount of the transaction. According to the company, this deal will make workflows simpler for small and medium-sized companies that are seeking less complicated ways to develop and grow their digital operations.

    The projected revenue for Cloudways in fiscal 2022 is more than $52 million, which would indicate a three-year compound annual growth rate of more than 50 per cent.

    Since 2014, DigitalOcean and Cloudways have been strong collaborators. About 50 per cent of Cloudways’ clients are currently powered by DigitalOcean infrastructure.

    Serving a clientele that is both global and expanding, both companies will service more than 124,000 clients who make monthly payments of over $50, or around 84 per cent of the pro forma company’s total revenue.

    For specific small and medium-sized enterprises wishing to outsource their on-ramp to the internet, Cloudways offers straightforward on-boarding and day-to-day management.

    The company assists such organisations in offloading the challenges of cloud infrastructure so they may focus more on managing and growing their operations.

  • FBR surpasses revenue collection target by Rs15 billion for July

    FBR surpasses revenue collection target by Rs15 billion for July

    The Federal Board of Revenue (FBR) revealed the provisional revenue collection data for July 2022, which came to Rs458 billion.

    The FBR generated net revenues of Rs458 billion in July, which was Rs15 billion more than its goal of Rs443 billion.

    These collections—which represent an increase of roughly 10 per cent over the Rs417 billion collected during the same time last year—are the biggest ever for the month of July.

    The gross revenue increased from Rs438 billion in July of the previous year to Rs486 billion, a rise of 11 per cent. Similarly, the amount of refunds given out in July increased by 32 per cent to Rs28 billion from Rs21 billion paid in the previous year.

    Domestic taxes made up 55 per cent of the total collection while import taxes kept their 40 per cent share.

    Previously, 52–53 per cent of the total revenue was collected via taxes at the import stage. Similarly, the increase in domestic income tax is close to 31 per cent, which the FBR described as a dramatic move toward direct taxation.

    The Advance Tax collected in July has increased significantly. Due to the implementation of a withholding provision that is applicable regardless of the holding term, there is also a 118 per cent rise in the advance tax on the sale of properties under Section 236-C.

    Similarly, a change in the tax rate has led to a 40 per cent increase in Advance Tax under Section 147, particularly from financial companies.

    Raising the FED rate on tobacco and cigarettes has also paid off. Sales tax from the tobacco sector increased by a record-breaking 67 per cent, while the FED from tobacco saw a record-high growth of over 47 per cent, or Rs2.6 billion.

    Additionally, the FED for international flight travel has climbed by more than 200 per cent. Additionally, Pakistan Customs saw a modest 2.58 per cent increase in revenue under the heading of customs duty during July 2022 compared to Rs65 billion collected during the same time last year.

    However, it fell short of the Rs77 billion target set for July as a result of the government’s import compression policy, which aims to limit the outflow of US dollars.

    In addition, the FBR lost around Rs11 billion in sales tax due to the zero-rating of petroleum goods.

    It is important to note that the number of income tax returns for the tax year 2021 has increased by 13 per cent to 3.4 million from 3.0 million for the tax year 2020.

  • FBR collects highest-ever tax of Rs6 trillion in FY22

    FBR collects highest-ever tax of Rs6 trillion in FY22

    The Federal Board of Revenue (FBR) achieved a significant feat by collecting a record Rs6,000 billion in revenue during the previous fiscal year 2021–2022.

    The FBR reported that during the current fiscal year, it collected Rs2,205 billion in income tax, Rs2,773 billion in sales tax, and Rs1,007 billion in customs duty. The organisation in charge of collecting taxes also released Rs305 billion in refunds during that time.

    According to former finance minister Shaukat Tarin, the government of Imran Khan’s policies and the country’s economic growth allowed FBR to meet its revenue goals.

    Tarin insisted that the government should continue enforcing the prior administration’s tax laws. According to Tarin, the government shouldn’t impose additional taxes on the current taxpayers. Heavy taxes shouldn’t be imposed on the economy’s productive sectors, he continued.

    The government has given the general public significant tax breaks on a number of necessities, but the FBR claims that these tax breaks haven’t prevented revenue collection from continuing on an unprecedented and constant growth trajectory. Sales tax on all POL products has been eliminated for the first time in the nation’s history, costing the FBR Rs45 billion per month.

    In order to maximise revenue potential through digitization, transparency, and taxpayer facilitation, the FBR has implemented a number of novel interventions at both the policy and operational levels. In addition to ensuring transparency, facilitating taxpayers, and making business easier, this has led to a steady increase in revenue collection.

  • Imposing super tax on the rich will reduce budget deficit: Miftah

    Imposing super tax on the rich will reduce budget deficit: Miftah

    The government’s recently announced indirect tax (super tax) is intended to assist the country in increasing tax revenue and lowering the budget deficit, according to Finance Minister Miftah Ismail.

    He was relating to the large industries’ 10 per cent super tax or poverty alleviation tax.

    13 industries, including LNG terminals, sugar, cement, steel, textile, tobacco, fertiliser, banks, oil and gas, beverages, automobiles, and steel, will be subject to this one-time levy, according to Miftah. The government labelled these 13 industries for a special tax as they made significant profits last year.

    Companies in these sectors earning more than Rs300 million will be subject to a 10 per cent super tax, he added.

    According to the finance minister, this tax is a one-time levy that will only be in effect for fiscal year 2022–2023.

    He clarified on Twitter that the 4 per cent super tax will be imposed on all industries.

    “For the specified 13 sectors, another 6 per cent will be added for a total of 10 per cent,” he said. “So their tax rates will go from 29 per cent to 39 per cent. This is a one-time tax needed to curtail the previous four record budget deficits.”

    The imposition of a super tax on the wealthy, according to Finance Minister, will lessen the country’s reliance on foreign aid, lower the budget deficit, and bring the country closer to financial stability.

    Other businesses that make over Rs150 million will be subject to a 1 per cent super tax, and those that make over Rs200 million will be subject to a 2 per cent tax. On top of the current rates, it is worth noting that these taxes are additional.

    Businesses that earn more than Rs250 million in revenue will pay a 3 per cent super tax, and those that earn more than Rs300 million will pay a 4 per cent super tax.

    He continued, citing statistics, that there were 9 million retail and wholesale establishments in Pakistan, and that the government wanted to bring an additional 2.5–3.5 million into the tax system.

    “We are linking the income tax and sales tax of these shops with the electricity bill,” Miftah said. “Now, small shops will pay a fixed tax of Rs3,000 and large shops will pay Rs10,000.”

    Only 22 of Pakistan’s more than 30,000 gold trading companies, he claimed, were registered, and their average annual sales came to Rs4,000.

    Sales tax and a fixed income of Rs40,000 will now be paid by gold shops of 300 square feet or less.

    He said that the government would lower the sales tax on large stores from 17 per cent to just 3 per cent.

    The withholding tax on jewellery sales to gold shops by the general public has been reduced from 4 per cent to 1 per cent.

    According to Miftah, fixed tax structures similar to these will be introduced for real estate agents, car dealers, and builders. Since this tax only applies to income and not to spending, inflation will not rise.

    Additionally, the withholding tax for the IT sector has been eliminated. Sales and income taxes would not apply to IT companies with annual revenue of less than Rs80 million.

    Miftah emphasised that Pakistan needs the IMF programme to resume as the country’s foreign exchange reserves are at a critical point.

  • Elimination, reduction of withholding taxes in budget 22-23

    On June 10, 2022, Pakistan will present its federal budget for 2022-2023. A number of new taxes measures are expected to be announced in the budget to raise additional income.

    It has been learned that a number of withholding taxes would be removed or lowered in the coming budget.

    The Federal Board of Revenue (FBR) will choose those withholding taxes that have lower revenue implications without jeopardising the goal of documenting as part of the budget planning process.

    According to Brecorder, to document future withholding transactions, a new Directorate-General for Synchronized Withholding Agents System would be developed.

    Withholding taxes cause inconsistencies will be reduced by the FBR, as all withholding taxes will be examined to see whether there are any distortions produced by income tax withholding, and adjustments will be made to correct them.

    This will be accomplished by making modifications to guarantee that all withholding tax received is either claimed or reimbursed in the return filed in response to the tax demand.

    Elimination of Taxes in budget 21-22

    The government had eliminated multiple withholding taxes, including the tax on royalty payments to residents during budget 21-22 such as cash withdrawals, banking tools, money transfers other than cash, tax collection from persons remitting funds abroad via credit, debit, or prepaid cards, tax collection on domestic and international air travel, mineral extraction, tax collection by a stock exchange registered in Pakistan, tax collection on marginal financing by NCCPL, CNG stations, and tax collection on certain petroleum products.

    Income Tax Ordinance

    The Income Tax Ordinance of 2001 contained 38 withholding tax measures. This large number of requirements adds to the complexity and places an excessive strain on different withholding agents to comply. It also has an impact on a country’s ease of doing business rating. In the last budget, 12 withholding taxes were eliminated in an effort to improve company ease and simplify tax rules.

    The Overseas Investors Chamber of Commerce and Industry (OICCI) advocated that the withholding tax (WHT) structure be overhauled and reduced from its current twenty-six rates to just five for filers.

    Only inactive taxpayers should be subject to this tax. Alternatively, the 8% WHT rate on services is a minimum tax that applies regardless of the service provider’s actual taxable revenue. This tax effectively becomes an indirect tax, raising the cost of doing business for service providers; as a result, service tax should be flexible.

    Withholding Tax Regime

    The Withholding Tax Regime (WHT) is a worldwide phenomena, and it is the primary source of federal revenue received at the national level in Pakistan. The collection of withholding taxes, as well as the reliance on them, has increased throughout time. Various Withholding Taxes, which are distinguished by their adjustable and presumptive nature, collected Rs422(b) out of total Direct Taxes collection of Rs740(b) for the financial year 2012, accounting for 57 per cent of total Direct Taxes collection.

    Since the imposition of direct taxes by governments and taxpayers on two counts, the withholding tax regime has been a feature of the tax system in some form or another:

    1. The government receives revenue on a consistent basis throughout the year to fund its expenditures and operations.
    2. Provides taxpayers with the opportunity to pay down their debts in affordable installments.

    Many countries have been obliged to change their economies in recent years as a result of globalisation, in order to unify tax laws and align them with new trade and investment policies represented in free trade agreements. “Hang Together” is more relevant today than it has ever been. Neither countries’ borders nor their economies can be closed. Tax policies are also inextricably linked to foreign economies.

    Due to the requirement for an entity to oversee and manage the Withholding Tax Regime in such a competitive climate, the Directorate General of Withholding Taxes was established by the Finance Act of 2008 under section 230A of the Income Tax Ordinance 2001.

  • PANAH suggests tobacco taxes be raised even higher

    PANAH suggests tobacco taxes be raised even higher

    Pakistan National Heart Association (PANAH) has proposed that the government increase tariffs on unnecessary and harmful tobacco products. Increased tobacco-related levies will lessen diseases and healthcare expenses while also helping to generate tax revenue.

    Sanaullah Ghumman, PANAH’s General Secretary, announced this at a news conference held by the Pakistan National Heart Association on Wednesday at a local hotel.

    Smoking, according to Sanaullah Ghumman, is not healthy for human health in any aspect, and it is the first step toward addiction. Health experts and civil society groups have also urged the Prime Minister to increase tobacco goods taxes.

    A significant number of health experts and civil society representatives attended the event. Tobacco kills 8 million people worldwide each year, according to a global study, and more than 1.5 million individuals in Pakistan lose their lives each year owing to smoking.

    On World Food Safety Day, PANAH proposed that tariffs on sugary drinks be increased as well, as these beverages are harmful to children and cause a variety of health problems.

    Sanaullah Ghumman spoke at the event, urging a 30 per cent rise in tobacco product taxes to protect minors from tobacco usage.

    “This will be a win-win situation for us,” he continued, “since it will lower the health burden while also dramatically increasing revenue”. PANAH, he claimed, had been educating the public about a variety of dangerous diseases, including heart disease and its causes, for 39 years.