Taxation System Chapter- 04Provided that an existing investment company shall raise its capital to Rs.100 million within a period of 3
years;- that no director, officer or employee of such company has been convicted of fraud or breach of trust;
- that no director, officer or employee of such company has been adjudicated as insolvent or has
suspended payment or has compounded with his creditors;
that the promoters of such company are, in the opinion of the Authority, persons of means and integrity and
have special knowledge of matters which the company may have to deal with as an investment company.
KIBOR [U/s 2(30AB)] means Karachi Interbank Offered Rate applicable on first day of each quarter of the
financial year-
Explanation: The introduction of KIBOR as basis for calculating additional tax and compensation rather
than determining these without prevalent market rates. U/s 171 at KIBOR concept has been introduced but
for levy of additional tax u/s 205, KIBOR plus 3% is discriminatory. For both purposes, the same basis
should be applied.“IRIS” [U/s (30AC)] means a web based computer programme for operation and management of Inland
Revenue taxes administered by the Board;
Information Technology (IT) services [U/s 2(30AD)] include but not limited to software development,
software maintenance, system integration, web design, web development, web hosting and network design;
and
IT enabled services [U/s (30AE)] include but not limited to inbound or outbound call centres, medical
transcription, remote monitoring, graphics design, accounting services, Human Resource (HR) services,
telemedicine centers, data entry operations, cloud computing services, data storage services, locally
produced television programs and insurance claims processing;
"Leasing company" [U/s 2(30B)] means a leasing company as defined in the Non-Banking Finance
Companies and Notified Entities Regulation, 2007;
Explanation: The relevant provision of the said law reads as under:
"Leasing company" means a company engaged wholly in the business of leasing or which invests in such
business at any one time an amount equivalent to at least 75% of its assets.
Provided that cash and bank balances and investment in government securities shall be excluded to
calculate investment in leasing business for purposes of this definition.
"Liaison office" [U/s 2(30C)] means a place of business acting for the principal, head office or any entity
of which it is a part, and
(a) Its activities do not result in deriving income in Pakistan; and
(b) maintains itself out of any amount remitted from outside Pakistan received through normal banking
channels.
Explanation, It is clarified that
(i) a place of business shall not be treated as liaison office if it engages in
(a) commercial activities;
(b) trading or industrial activities; or
(c) the negotiation and conclusion of contracts;
(ii) the activities shall be treated to be commercial activities, if these include
(a) providing after sales services for goods or services; or
(b) marketing or promoting pharmaceutical and medical products or services;
(iii) subject to clause (i) a place of business shall be treated as a liaison office, if it undertakes activities of
(a) an exploratory or preparatory nature, to investigate the possibilities of trading with, or in,
Pakistan;
(b) exploring the possibility of joint collaboration and export promotion;