Income Tax Ordinance, 2001 — Section 99: Special provisions relating to insurance business

99. Special provisions relating to insurance business. — The profits and gains of any insurance business shall be computed in accordance with the rules in the Fourth Schedule. 1[ ] 2[ ] 3[99A.Special provisions relating to payment of tax through electricity connections. (1) Notwithstanding anything contained in the Ordinance, a tax shall 1 Inserted by the National Assembly Secretariat’s O.M. No.F.22(2)/2016-Legis dated 29.01.2016. 2 Section 99A substituted by the Finance Act, 2022. The substituted section read as follows: “99A. Special provisions relating to traders.-(1) Subject to sub-section (3), tax payable on the profits and gains of a trader as defined in sub-section (4) who upto thirty first day of December, 2015 has not filed a return for any of the preceding ten tax years shall be computed in accordance with the rules laid down in Part I of the Ninth Schedule.

(2)Subject to sub-section (3), tax payable on the profits and gains of any trader as defined in sub-section (4), who

(a)is a filer; or

(b)is NTN holder and a non-filer but has filed return or returns in any of the last ten preceding tax years, shall be computed in accordance with the rules laid down in Part II of the Ninth Schedule.

(3)Sub-sections (1) and (2) shall apply, if

(a)the return filed by the trader qualifies for acceptance in accordance with the rules laid down in the Ninth Schedule;

(b)return relates to tax years 2015 to 2018; and

(c)income from business consists of profits and gains from trading activity only.

(4)For the purpose of this section and the Ninth Schedule, ‘trader’ means an individual or an association of persons (AOP) buying goods or merchandise and selling the same without further processing and providing, business-related after sales, services by doing repair jobs. Explanation 1.- For the removal of doubt it is clarified that any person engaged in

(a)rendering of, or providing, services as defined in clause (ii) of sub-section (7) of section 153; or

(b)business of retailer falling under rule (5) of Chapter II of the Sales Tax Special Procedures Rules, 2007, shall not be treated as a trader for the purposes of this section. Explanation 2.- It is also clarified that this section shall not apply to a person who is a Member of the Senate of Pakistan, the National Assembly of Pakistan or a Provincial Assembly.”] 3 Section 99A substituted and shall be deemed to have been so substituted from 1 st day of July, 2022 by the Tax Laws (Amendment) Act, 2023 (XVI of 2023) dated 20.04.2023. Earlier this section was substituted through Tax Laws (Second Amendment) Ordinance, 2022 (VI of 2022) dated 22.08.2022. The substituted section read as follows: “99A. Special provisions relating to payment of tax through electricity connections.– (1) Notwithstanding anything contained in the Ordinance, a tax shall be charged and collected from retailers other than Tier-I retailers as defined in Sales Tax Act, 1990 (VII of 1990) and specified service 169 Chapter VI – Special Industries be charged and collected from retailers other than Tier-I retailers as defined in the Sales Tax Act, 1990 (VII of 1990) and specified service providers on commercial electricity connections at the rates specified in the income tax general order issued in terms of sub-section (2).

(2)For the purposes of this section, the Federal Government or the Board with the approval of the Minister in-charge pursuant to the approval of the Economic Coordination Committee of the Cabinet may, issue an income tax general order to

(a)provide the scope, time, payment, recovery, penalty, default surcharge, adjustment or refund of tax payable under this section in such manner and with such conditions as may be specified;

(b)provide the collection of tax on the amount of bill or on any basis of consumption, in addition to or in lieu of advance tax collectible under sub-section (1) of section 235, at such rates or amounts, from such date and with such conditions as may be specified;

(c)provide record keeping, filing of return, statement and assessment in such manner and with such conditions as may be specified;

(d)provide mechanism of collection, deduction and payment of tax in respect of any person;

(e)include or exempt any person or classes of persons, any income or classes of income from the application of this section, in such manner and with such conditions as may be specified; and

(f)provide that tax collected under this section shall in respect of such persons or classes of persons be adjustable, final or minimum, in providers on commercial electricity connections at the rates provided in clause (2A) of Division IV, Part IV of the First Schedule.

(2)A retailer who has paid sales tax under sub-section (9) of section 3 of Sales Tax Act, 1990 (VII of 1990), shall not be required to pay tax under this section and the sales tax so paid shall constitute discharge of tax liability under this section.

(3)The tax collected or paid under this section shall be final tax on the income of persons covered under this section in respect of business being carried out from the premises where the electricity connection is installed.

(4)For the purposes of this section, Board with the approval of the Minister in-charge may issue an income tax general order to

(a)provide the scope, time, payment, recovery, penalty, default surcharge, adjustment or refund of tax payable under this section in such manner and with such conditions as may be specified.

(b)provide record keeping, filing of return, statement and assessment in such manner and with such conditions as may be specified;

(c)provide mechanism of collection, deduction and payment of tax in respect of any person; or

(d)include or exempt any person or classes of persons, any income or classes of income from the application of this section, in such manner and with such conditions as may be specified.] 170 Chapter VI – Special Industries respect of any income to such extent and with such conditions as may be specified.

(3)The provisions of sub-section (1) of section 235 shall apply to the persons as specified therein unless specifically exempted under the income tax general order issued under sub-section (2).

(4)The provisions of section 100BA and rule 1 of the Tenth Schedule shall not apply to the tax collectible under this section unless specifically provided in respect of the person or class of persons mentioned in the income tax general order issued under sub-section (2).] 1 [99B. Special procedure for small traders and shopkeepers:-Notwithstanding anything contained in this Ordinance the 2[Board with the approval of the Minister in-charge] may, by notification in the official Gazette, prescribe special procedure for scope and payment of tax, filing of return and assessment in respect of such small traders and shopkeepers, in such cities or territories, as may be specified therein.] 3 [99C. Special procedure for certain persons.- Notwithstanding anything contained in this Ordinance, the 4[Board with the approval of the Minister-in charge] may, by notification in the official Gazette, prescribe special procedure for scope and payment of tax, record keeping, filing of return and assessment in respect of small businesses, construction businesses, medical practitioners, hospitals, educational institutions and any other sector specified by 5[Board with the approval of the Minister-in-charge], in such cities or territories, as may be specified therein.]