Jail Time for Transformer Star??

New York: It seems the release of Transformer Age of Extinction has Shia LaBeouf on edge.
The actor, who started his career on the Disney Channel with the show Even Stevens has come a long way
from his pranking days. LaBoeuf was arrested inside New York"s Studio 54 during a performance of Cabaret on Thursday, Police Said.

The actor was charged with criminal conduct and disorderly conduct and taken into custody, NYPD
detective Brian Sessa said, LeBoeuf was escorted out of the theatre by Police, after refusing to go when
asked to do so by security guards, said NYPD spokesmen George Tsourovakas.

The 28 year-old actor, who gave  police a Los Angeles address, began making a disturbance and then used
obscene language and became belligerent after security guards asked him to leave, Tsourovakas said.

He was being rather difficult and combative, verbally... to the point where security guards asked him to please leave the premises and he refused, Tsourovakas said. Police were called and he was detained and arrested.

A representative of LeBoeuf could not be reached immediately for comment.

HR development: Country steps up focus on Islamic finance education

As part of the SBP initiatives, universities and institutions wishing to develop Islamic finance education will be supported financially if they wish to set up specialised chairs in Islamic banking and finance. CREATIVE COMMONS

LONDON: 

With the share of Islamic banking surpassing 10% in the total banking sector, there is an increasing focus on human resource development for Islamic banking and finance in Pakistan.

The State Bank of Pakistan (SBP) recently launched an initiative to develop and support centres of excellence in Islamic banking and finance at various universities and academic institutions in the country. Consequently, some of the top academic institutions contemplate setting up teaching and research centres specialising in Islamic banking and finance.

The Institute of Business Administration (IBA) is said to have already received a large grant from the SBP to set up a centre of excellence in Islamic finance, and other prestigious universities, including Lahore University of Management Sciences (LUMS), have applied for significant sums of money to develop Islamic finance courses and modules.

As part of the SBP initiatives, universities and institutions wishing to develop Islamic finance education will be supported financially if they wish to set up specialised chairs in Islamic banking and finance.

It is a commendable initiative but this begs an important question: how many academicians are there in Pakistan who can hold such specialised chairs?

Perhaps not very many people are aware of the fact that Darul Uloom Karachi, an Islamic seminary run by Mufti Rafi Usmani and Mufti Taqi Usmani, has for long been offering education in Islamic banking and finance. Consequently, almost all the Islamic financial institutions in Pakistan have employed graduates of Darul Uloom Karachi.

Another notable institution that has provided human resources for Islamic banks and financial institutions in Pakistan and overseas is International Islamic University Islamabad (IIUI), but lately it has lost its central position to some new players like PAF Karachi Institute of Economics and Technology (PAF-KIET) and COMSATS Institute of Information Technology, Lahore. These new institutions now feed personnel into local Islamic banks and financial institutions.

While Darul Uloom Karachi has been a forerunner in Islamic finance education in Pakistan, the basic approach has been juristic, ie, with a heavy focus on Shariah and law. The entry of new players like LUMS and IBA is expected to bring a new dimension to teaching of Islamic banking and finance, with a focus on quantitative analysis.

Growing demand

Demand for highly qualified personnel in Islamic banking and finance is increasing. According to Edbiz Consulting, a London-based Islamic financial think tank, by the end of 2014, the global size of Islamic financial services industry will surpass $2 trillion. With this, it is expected that demand for human resources will also increase, globally as well as in Pakistan.

According to an on-going global poll at islamiceconomist.com, IIUI is recognised as the leading university in the world that has fed personnel into Islamic financial services industry globally. There is a need to reinvigorate this university by connecting it with the industry.

The current government is focusing heavily on the development of physical infrastructure. Maryam Nawaz has been given the task of youth and human capital development.

The government must revisit the role of Islamic finance education in reforming curricula of Islamic seminaries as well as universities and colleges. In this respect, there is a need to look into the hybrid model that IIUI provides. This institution should not be treated just like another university in the country but rather its international character should be preserved and enhanced.

Commercial viability

Another aspect of Islamic finance education is its commercial viability. The likes of government of Malaysia take Islamic finance education very seriously. Consequently, a number of universities in Malaysia have started feeding personnel into Islamic financial institutions throughout the world.

This is an area in which Pakistan can play an even bigger role, if the government decides to include Islamic banking and finance as a strategic sector in its growth and development strategy.

So far, global recognition of Islamic finance qualifications offered by Pakistani institutions is rather limited. In the last three years, Global Islamic Finance Awards (GIFA) has recognised the likes of ETHICA (a Dubai-based provider of Islamic finance qualifications), INCEIF (based in Kuala Lumpur), Universiti Utara Malaysia, Durham University (UK), IBFIM (Malaysia) and CIMA (UK).

Pakistani institutions have not pitched themselves for global recognition and it is perhaps the time that such institutions start marketing themselves globally.

The writer is an economist and PhD from Cambridge University

Mandzukic: I'm leaving Bayern

The striker says despite his best efforts he simply cannot get the best out of himself in the club's new playing style and will now depart for pastures new

Mario Mandzukic has confirmed he will leave Bayern Munich as a result of his failure to adapt to Pep Guardiola's tactics.

Mandzukic has been linked with a host of Premier League clubs, including Chelsea, after his future with the Bundesliga giants came under scrutiny following the signing of Dortmund striker Robert Lewandowski.

The Croatia international - a regular former boss Jupp Heynckes - was in and out of the side last season and ended the campaign by being dropped for the DFB Pokal final victory over Dortmund. 

The 28-year-old striker has now confirmed he is leaving Bayern, and pointed to Guardiola's possession-based style as the primary factor behind that decision.

Mandzukic also revealed he had a meeting with Karl-Heinz Rummenigge in early May, telling the Bayern chief he wanted a move.

"At Bayern it was fantastic. It's a fantastic club. Indeed, until recently I didn't even think about leaving, and especially that it would happen now," he told Sportske novosti.

"Let's be honest, the style Guardiola wants at Bayern doesn't suit me.

"In the first leg against Real in Madrid (in the Champions League), I definitely understood, no matter how much I try, I can't get the best out of myself with this style.

"When it's like that, I don't feel good and it's best for everyone that we part.

"Thanks to the club who offered a contract extension, thanks to Guardiola, who is a great coach, and I wish everyone all the best for the future.

"Bayern and their fans will always be the most beautiful and most emotional story of my career. The time has come for new challenges."

Mandzukic refused to say where his next challenge would be as he prepares to represent Croatia at the World Cup.

He is suspended for Thursday's tournament opener against Brazil, but is sure to face Cameroon and Mexico in Group A.

Agent dismisses Arda Turan to Barcelona reports

The Turkey international's representative has played down reports the Camp Nou club have contacted him about a move for his client this summer

Atletico Madrid midfielder Arda Turan is not close to switching to La Liga rivals Barcelona this summer and is “happy” with at the Vicente Calderon.

The Turkey international has been linked with a move away from the Spanish capital this summer with several clubs said to be interested in the 27-year-old’s services.
Recent reports stated that Barcelona were willing to pay Arda's €24m buyout clause despite the midfielder only signing a new contract in September last year, which will keep him at the club until 2017.
However, the player's agent Ahmet Bulut has stressed that his player is happy at Spanish champions Atletico and does not want a move away from the Madrid-based club.
"What has been published and has been put in my mouth is false. Barça have not contacted me about Arda and the player is happy at Atletico," Bulut was quoted as saying in Mundo Deportivo.
The rumours surfaced after Bulut was spotted in Barcelona, but the agent explained he was there to negotiate with a German side over a move for one of his players currently in Serie A.

Clarke banks on full-strength squad for Africa

PHOTO: AFP

SYDNEY: Australian captain Michael Clarke said on Wednesday that he expects to have a full-strength squad, apart from David Warner, for the upcoming tri-series with South Africa and Zimbabwe.

Australia are due to play four one-dayers in Harare in August and September, two against each African nation, as well as a potential final.

Clarke said the tour was a crucial step in the team’s preparations for next year’s World Cup and he wants as strong a team as possible alongside him.

“It’s an important series,” he told reporters. “Any one-day game leading up to the World Cup is crucial to us as a team.

“The more success we can have leading into that tournament the better, so hopefully (it’s) a full-strength team that’s ready to play against two very good teams in tough conditions.”

One player who will not be on tour is opener Warner, who has pulled out citing a draining playing schedule and the upcoming birth of his first child.

Australia get their tour underway against Zimbabwe on August 25 before meeting South Africa two days later, who will continue to be led in the limited-overs format by AB de Villiers.

Clarke said it was too early to tell what kind of a leader Amla would be but he expects him to be a success.

“I was surprised, but Amla is obviously a wonderful player,” he said. “I’ve enjoyed the challenges I’ve had against him and I think he’ll do a fantastic job for South Africa.”

Meanwhile, he also said their upcoming series against Pakistan in October-November will be a big test for them. Clarke, who is focused on Australia’s forthcoming series, said, “Our goal is to continue our form in the Test arena and prove we are capable of staying at the top. Our upcoming series against Pakistan (October-November) and India (November- January) will be big tests for us.

Defending champions Spain pledge clean bill of health

Spain will look to defend their World Cup title with doubts raised on player’s fitness and physical preparedness after a hard season with clubs. PHOTO: AFP

WASHINGTON: Spain’s players said that they will be fit for the defence of their World Cup crown in Brazil, despite the rigours of a long club season.

Right back Juanfran sprained his right ankle in the Champions League final that Atletico Madrid lost to Real Madrid on May 24, but he vowed he would be ‘100%’ healthy and ready for Brazil.

“I don’t have any problem, and I am 100% with the team,” the Atletico Madrid defender told a press conference in Washington, where Spain will train prior to a Saturday friendly against El Salvador.

The 29-year-old said he was limping in the wake of the painful injury, but insisted he was now recovered and had told Del Bosque, “When you need me, I’ll be there and I’ll do my best.”

Meanwhile, midfielder Santiago Cazorla doesn’t think Spain will be any less ready than their opponents.

“The season has been tough for everyone. I don’t think we are any more or less tired than the other teams,” said Cazorla, adding that Spain’s squad is ‘physically better every day’.

Brazil stroll against Panama

World Cup hosts Brazil strolled to a 4-0 win over Panama in their penultimate warm-up Tuesday, with goals from Neymar, Daniel Alves, Hulk and Willian securing the win which barely satisfied their coach Luiz Felipe Scolari.

“I am still concerned. We are getting better — but we know we have a fair way to go,” said Scolari.

“The run out was worthwhile but we must up our rhythm and be a lot better for the Croatia game.”

Meanwhile, Greece and Nigeria battled to a scoreless draw on Tuesday in an international friendly match that served as a warm-up for both teams before the World Cup.

Every World Cup player to have drug test

Fifa is on an ambitious mission to make sure that for the first time every player who takes part in the World Cup has a drug test and carries a ‘biological passport’.

Players can expect a tap on the shoulder right from the first matches of the World Cup which starts June 12.

“We can test anybody, anytime, anywhere, any amount of times,” said Jiri Dvorak, FIFA’s chief medical officer in a recent interview.

On the safe side: K-P government planning to use IPVs to help eradicate polio

IPV is administered via injection and according to the World Health Organization (WHO), all countries currently only using OPV should add at least one dose of IPV to their immunisation programmes. PHOTO: FILE

PESHAWAR: The Khyber-Pakhtunkhwa government has planned to administer inactivated polio vaccines (IPV), along with the oral polio vaccine (OPV) it already uses, for effective protection against poliovirus in the province.

IPV is administered via injection and according to the World Health Organization (WHO), all countries currently only using OPV should add at least one dose of IPV to their immunisation programmes. The WHO also recommends an OPV dose at birth, followed by the primary series of three OPV doses and at least 1 IPV dose.

“The IPVs will become part of the Expanded Programme on Immunisation (EPI),” EPI Deputy Director Dr Janbaz Afridi told The Express Tribune on Wednesday. Though the plan has been approved, it is undecided at the moment as to when it will be put into effect. He explained that under the programme, children under two years of age will be administered the injections in areas where polio drops have already been administered.

The programme to administer the IPV would initially be launched in Peshawar with the help of the WHO and Unicef, who are helping the province in its vaccination campaigns.

Dr Afridi added the IPV injections have already arrived but are yet to be put into use as the decision to kick-start the vaccine is yet to be taken.

This is a major change in the K-P government’s strategy to eradicate the virus with nine of 68 polio cases this year having emerged from the province.

Even though water samples recently taken from Peshawar were reported clear of the poliovirus, the provincial capital is still considered a place where the virus still exists, with four cases being discovered this year.

The Chief Minster’s (CM) Polio Monitoring Cell Focal Person Imtiaz Ali Shah told The Express Tribune that the injectable vaccines are used all over the world.

He said the polio advisory board has decided to use them in Peshawar along with regular polio drops for children up to two years of age, adding a high-level meeting chaired by the CM will finalise the contours of the programme.

“The drops will be given to children who have already been administered polio drops and are protected from the virus,” said Shah

Aisam to address House of Commons

Aisamul Haq Qureshi. PHOTO: FILE

KARACHI: Before starting his campaign at Wimbledon this month, Pakistan tennis ace Aisamul Haq Qureshi is preparing to receive the biggest accolade of his off-court career.

He will be addressing the British and UK-based Pakistani dignitaries at the House of Commons in Westminster for two hours on June 10.

His agenda will be to promote peace through tennis for his ‘Stop War, Start Tennis’ foundation, in which he will be emphasising on bridging cultural gap through sports in the international community.

The country’s only tennis athlete to play at the ATP circuit was invited by Speaker John Bercow, who praised Aisam for his role as an ambassador for youth and sportspeople all over the world.

“This is the biggest off-court accolade for me,” Aisam told The Express Tribune. “It’s an honour as a Pakistani to speak for my foundation at the House of Commons and get a chance to talk about our work.

“The speaker of the house proposed that I should address the dignitaries, and I’m extremely grateful for that. My focus will be to promote Pakistan’s soft image.”

The Lahore-based player admitted that he was anxious to put his best foot forward at the important occasion.

“My friends and family will be there and I’m a little nervous. I want to make sure that my speech makes an impact.”

Aisam has been involved with the United Nations, Pakistan Red Crescent Society and has also received the 2002 and 2010 Arthur Ashe Humanitarian Awards by the ATP Tour Inc.

Aisam also engages in the distribution of sport-specific equipment among amputees and disabled tennis players, and plans to donate wheelchairs to Pakistan, Iraq, Afghanistan and Cambodia.

Seeking redemption at Wimbledon

Aisam said that his second-round exit at the French Open men’s doubles was unexpected for him, but he wants to make up for the loss in Wimbledon.

“I was also unable to play the mixed doubles because of a knee-injury, but now it’s healing.

“I want to make up for the French Open defeat as well. Wimbledon is also special because grass is my favourite surface.

Diego Costa passes Chelsea medical

The Stamford Bridge club are poised to finalise the €43 million [£35m] signing of the Atletico Madrid striker, after agreeing the terms of the deal

By Wayne Veysey

Diego Costa has completed a medical at Chelsea and is now on the verge of completing a €43 million [£35m] move from Atletico Madrid.

Goal revealed early last month that a deal worth £75m, including transfer fee and salary, was finalised at a meeting in London less than 24 hours after Costa's penalty helped Atletico Madrid to eliminate the Blues from the Champions League.

	CHELSEA LATEST
25/1	Diego Costa is 25/1 with Paddy Power to be top scorer at the World Cup

The Brazil-born striker, who is a member of the Spain squad preparing for the World Cup, has long been identified by Mourinho as the player to provide a more regular supply of goals than Fernando Torres, Samuel Eto’o and Demba Ba were able to contribute last season.

Chelsea will pay around €43m for the striker, although a significant portion of the transfer fee includes agents' fees.

The move will also more than triple the wages of Costa, who is believed to earn around £50,000 a week at the Vicente Calderon Stadium. Chelsea will hand the 25-year-old a five-year contract worth £150,000 a week.

As reported by Goal in April, it had long been the plan of the west Londoners to confirm the deal before the World Cup, where he is expected to lead the line for Spain if he can recover from the hamstring injury that restricted him to just a short run-out in Atletico’s recent Champions League final defeat to Real Madrid.

Representatives of the Londoners have held a series of meetings with Costa's camp in recent months and the set of talks around the two clubs' Champions League second-leg showdown closed the deal.

Costa emerged as Chelsea's top centre-forward target following an outstanding campaign for Atletico, who won La Liga as well as finishing Champions League runners-up.

The 25-year-old scored 36 times in 50 matches for his club in the recently completed domestic season and his 27-goal league haul was third only to Cristiano Ronaldo (31) and Lionel Messi (28).

Chelsea were keen to trigger the Brazil-born forward's release clause in January, when he was also being closely monitored by rivals Arsenal, but the player did not want to leave in mid-season.

Mourinho has made no attempt to hide his desire to recruit a blue chip centre forward amid doubts over the futures of Torres, Eto'o and Ba. At least two of the trio are expected to leave in the summer, while Romelu Lukaku will hold talks with Chelsea chiefs this summer following a season-long loan at Everton.

Chelsea have been active in the transfer market following the completion of the domestic season.

The Londoners have agreed a deal with Paris Saint-Germain to sell David Luiz for an initial €49m [£40m] although the French champions have yet to officially confirm the Brazilian’s arrival.

Mourinho is also looking for a new left-back and a new central midfielder following the departures of Ashley Cole and Frank Lampard. Chelsea’s top midfield target is Juventus’ Paul Pogba and they are also monitoring the situation of Cesc Fabregas.

Hazard future will be sorted after World Cup, says father

The Belgium international has been linked with a big-money transfer to Paris Saint-Germain but his father says there will be no transfer updates during this summer's tournament

Eden Hazard will make a decision on his Chelsea future after the World Cup in Brazil, according to the player's father.

The Belgium international has been heavily linked with a move to Paris Saint-Germain, who have already agreed a deal for Blues team-mate David Luiz, while the French champions' coach Laurent Blanc has hinted at a bid for the 23-year-old winger.

However, Hazard revealed on Tuesday what number jersey he will be donning next season, saying in a statement: "I am very pleased to be able to wear the No.10 for Chelsea.

"It is my favourite number and is one I am used to wearing for the national team, as well as the one worn by some of my heroes from when I was a kid, like Zinedine Zidane.

"I hope it brings me a lot of luck in the future and I look forward to the fans seeing me in it next season."

And Thierry Hazard claims there will be no transfer updates during the World Cup, as his son looks to guide Belgium to glory in Brazil.

“Eden? There is nothing yet. Every day I read new information,” he told Sudpresse. “Eden just wants to focus on the World Cup.

“There will be no news during the tournament.”

Van Gaal interested in Strootman, says agent

The new Manchester United coach included the Roma star on his six-man summer shortlist, but the player's representative says any sale would be decided only by the Serie A side

The agent of Kevin Strootman says Louis van Gaal is interested in the Roma midfielder, though there has been no official approach from Manchester United and the Italian capital club will resist any sale.

The new United boss included the 24-year-old is his six-man shortlist of desired transfer targets, but is currently sidelined with a serious knee injury until the autumn.

Strootman and Van Gaal have built up a relationship through the Netherlands national setup, but agent Chiel Dekker insists any sale would only be sanctioned should Roma see fit and not the player himself.

"He won’t be back playing until autumn - that’s the time schedule at the moment," Chiel Dekker told The Guardian. "He is of interest to Louis van Gaal but not related to Manchester United at this point."

When probed as to whether he would be of greater interest in the future, he added: "[He] could be. But he’s in Rome and he had a terrific season. There has been nothing between the clubs or between Louis and Kevin - they know each other and like each other but at this stage its not related to Man United.

"Roma do not want to sell. The first thing is its all between [the] clubs. And it's also a very difficult decision because he has to choose between a fantastic club in Rome, a club that bought him and supported him while he was injured and [then] you have his personal coach of the national team at United.

"The clubs have to decide. He’s very happy at Rome, he’s happy to stay because they will play in the Champions League next season, and he is happy to recover from his injury, so at this stage we are not part of any discussion.

Pique: Barcelona don't appreciate Fabregas

The defender says Barca have not shown his in-demand club and international team-mate the respect he deserves since re-joining them from Arsenal

Gerard Pique has criticised Barcelona for the way they have treated team-mate Cesc Fabregas, insisting that the club don't appreciate him as much as they should.

The midfielder has failed to cement himself as a key player in the first-team of the Catalan giants since he re-joined them from Arsenal back in 2011.

This summer, Fabregas has been linked to a move back to England, with Manchester City, the Premier League champions, already preparing a €37 million bid for the Spain international, while the Gunners are also interested.

Pique hopes his Spain team-mate will ignore the advances of his Premier League admirers and remain with Barca, but admits he feels the club have not shown Fabregas the respect he deserves.

"I really like Cesc and I know he is going through a tough time because the club don't appreciate him as much as they should," the defender said at a press conference.

"He is one of those players who would be first-choice at any other club in the world, the star of the team.

"Despite that, he is finding it harder at Barca. I don't know what he is going to do; we haven't spoken about that.

"I hope he stays, because if you look at his stats this season, he is our highest-scoring midfielder and the one with the most assists. Of course I want him to stay with us."

For less than 12 months: Proposal put forward to increase Capital Gains Tax to 12.5%

Tax not applicable on sale of stocks after holding period of 2 years.

KARACHI: 

The government has proposed to increase the capital gains tax (CGT) rate on the trade of securities with a holding period of less than 12 months by 2.5% in 2014-15.

Addressing the budget session on Tuesday, Finance Minister Ishaq Dar proposed that the CGT rate on the sale of shares within a year of their purchase should be increased to 12.5% while the hike on the sale of stocks with a holding period of more than 12 months, but less than 24 months, should be 10%.

CGT will not be applicable to the sale of stocks after a holding period of two years, Dar proposed.

CGT is calculated on the basis of the amount that exceeds a share’s purchasing price. This means an investor will be required to pay Rs1.25 in CGT in case he sells a share for Rs110 within a year of buying it for Rs100.

Contrary to the general perception, CGT applies to investors, not brokers. Increasing the CGT rate is expected to discourage investors from active buying and selling of shares, thus reducing overall stock market liquidity.

In the outgoing fiscal year, the CGT rate on the sale of securities is 10% for the holding period of less than six months and 8% for the holding period of six to 12 months.

Originally, the CGT rate applicable to shares with a holding period of less than six months was due to increase from 10% in 2012 to 12.5%, 15% and 17.5% in the following years. There was no CGT on the sale of securities after holding them for a year.

However, the government kept the rate unchanged at 10% for the last two years. It meant the CGT rate was supposed to go up by 7.5% to 17.5% in one go in 2014-15. But instead of raising it substantially at once, the government has proposed to increase it by 250 basis points for 2014-15.

Speaking to The Express Tribune, Topline Securities CEO Mohammad Sohail said the stock market is likely to react positively to the less-than-expected increase in the CGT rate.

Similarly, in a research note issued to its clients on Tuesday, KASB Securities said the reduction of the CGT rate from the originally proposed 17.5% to 12.5% constitutes ‘considerable lowering’ and will be received positively by local domestic investors.

The CGT collection in July-April remained Rs1.5 billion. The National Clearing Company of Pakistan (NCCPL) collected Rs1.2 billion in CGT during 2012-13 from individual investors, brokers and corporate entities. The NCCPL is not authorised to collect CGT from mutual funds, banks, non-banking finance companies, insurance companies and modarabas, as they pay their CGT directly to the FBR.

Higher advance tax on interest income, dividends

The finance minister proposed that 5% additional advance tax should be deducted from the payment of dividends and income in case the recipient is a non-filer of income tax returns. Later on, they can claim adjustment of the additional tax paid in case they file their returns, he said.

However, the additional tax on income will not be deducted if someone’s total income on interest is less than Rs500,000, it is proposed.

Foreign institutional investors

Currently, foreign institutional investors are not required to file their returns nor are their taxes on capital gains collected. The budget envisages that foreign institutional investors be brought under the tax regime, thus broadening the tax regime.

Published in The Express Tribune, June 4^th, 2014.

Telecom receives much-needed relief

FED removed, withholding tax reduced by 1%. PHOTO: FILE

KARACHI: In a move that will provide the much-needed relief to the heavily-taxed telecommunication sector, the government withdrew federal excise duty (FED) on telecom services from provinces already charging general sales tax (GST) and reduced withholding tax by 1 percentage point.

“In order to simplify the tax regime, it has been decided to withdraw FED from those provinces which have imposed GST on telecom services,” Finance Minister Ishaq Dar said in his budget speech.

This reform in the tax regime is in line with expectations of the telecom sector that had been lobbying for a centralised tax regime to avoid double taxation – the telecom sector was previously paying a whopping 19.5% GST and as much FED to provinces and federation respectively.

For provinces where no GST is charged, the government has reduced the FED from the current 19.5% to 18.5%, according to the draft of Dar’s  speech. However, this 1% reduction in FED is far from the industry’s recommendation of reducing the same by 2.5%.

Another tax benefit to the telecom sector came in the form of reduction in Withholding Income Tax on telephone services. The finance ministry reduced the advance income tax on telecom services from the current 15% to 14% – this also disregards the recommendations of the telecom lobby that had proposed to reduce the withholding tax by 5% to 10%.

In addition to the aforesaid relaxations, the finance ministry – in accordance with the already-announced policy – also proposed to reduce the corporate tax rate by one percentage point. The corporate tax rate shall be 33% for FY2014-2015, Dar informed in his speech.

Telecom sector has been contributing significantly to the national exchequer – cellular mobile companies, alone, paid $5.4 billion in taxes in the last five years, at an average of over $1 billion a year. Besides that, four of the five cellular mobile operators (CMOs) functioning in the country have invested $1.1 billion earlier this year by purchasing licences for 3G and 4G mobile internet services that have already started to roll out.

Though not all of the telecom sector’s recommendations were accepted by the finance ministry, whatever relief is given to the sector would be welcomed by the industry.

Retail sector

The finance ministry also proposed to bring – the largely undocumented – retail sector under the tax net by making it compulsory for all retailers to obtain their national tax number (NTN) while seeking electricity and gas connections for their businesses.

“Because of a variety of reasons, most of the retailers are still not under the tax net,” Dar said. “After carefully studying the issue, we’ve concluded that most of the retailers are willing to pay their due share of taxes but they want a simple and easy method of doing so,” he said.

The finance ministry, therefore, introduced a two-tier Simplified Sales Tax Regime for Retailers and categorised the retailers accordingly.

The first-tier comprises retailers who operate as part of national and international chain stores, operate in air-conditioned shopping plazas, have [point-of-sale] machines for credit or debit cards, or have monthly electricity bills in excess of Rs50,000, according to the draft of Dar’s  speech.

“These retailers will be required to pay GST in the normal regime and to keep electronic cash register of approved-specifications in order to record their transactions,” the finance minister said.

All remaining retailers will fall in the second tier.

For tier II retailers, the ministry would introduce a mechanism for payment of sales tax through the retailers’ electricity bills, the minister said. “Thus, retailers having electricity bills of less than Rs20,000 in a month shall be charged only 5% of the bill as sales tax on retail sales while those with higher bills shall be charged 7.5% as sales tax on retail sales.”

The finance ministry proposed to link the utility bills of retailers with their NTN, which would help the government in tracing the tax record of retailers – both the already-established players and the new entrants.