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.

Defence spending jacked up by 11.1%

After Rs73b increase defence budget for 2014-15 stands at Rs700.2b. PHOTO: FILE

ISLAMABAD: 

Pakistan has raised its defence spending by 11.1 per cent for the coming fiscal year amid reports that the army is preparing for the final push against Taliban militants holed up in the tribal areas bordering Afghanistan.

Defence budget has been jacked up to Rs700.2 billion for the financial year beginning July 1, compared with Rs627.2 billion allocated in the outgoing fiscal year, showing an increase of Rs73 billion. The military had sought an increase of Rs173 billion.

Military officials defended the increase insisting that Pakistani military’s expenses are the lowest in the region given the volatile security environment.

The budget document presented before the parliament did not give a breakdown of the allocations for the three forces. But according to defence ministry officials, out of the whole defence budget, Pakistan Army gets 48% while 20% goes to air force and navy’s share is 10%.

According to the budget document, out of Rs700.2 billion, Rs293.5 billion has been allocated for employees-related expenses, Rs180.2 billion for operating expenses and Rs152.8 billion has been earmarked for physical assets.

However, the figures do not include Rs163.4 billion allocated for pensions of the servicemen that would be given from the civilian budget and a separate allocation for security-related expenses in a move which, critics say, seeks to conceal the actual defence budget.

Additionally, the military would also be given Rs165 billion under the contingent liability and Rs85 billion under the Coalition Support Fund (CSF). This means that in reality a whopping Rs1113 billion has been allocated for the military, which is about 28.2% of the country’s total budget.

Defence budget has remained a sensitive and controversial subject in the country where it has never been debated in detail in the parliament. Of late, however, there have been calls for a greater scrutiny. And Senate’s defence committee recently took the initiative to publicly discuss the military spending.

Pakistan raises its defence spending every year because of its historically uneasy relations with arch-rival India.

New Delhi earlier this year jacked up military spending by 10% for the coming fiscal year as it seeks to counter China’s rapid military buildup and its traditional rival Pakistan.

Defence analysts believe given the internal security challenges much of the increase in the defence budget by Pakistan is likely to be spent on the fight against militancy.

We won't force Rakitic to stay, say Sevilla

The club have made it clear they will not keep any player who has set their heart on a transfer but insist the Croatia star will only leave for the right price

Sevilla president Jose Castro insists his team "have no need to sell" Ivan Rakitic - but says that he will not stand in his way should the midfielder ask to leave.

The Croatia international has been linked with a number of top European sides after an inspired 2013-14 season in which he led Sevilla to fifth place in La Liga and Europa League glory.

The 26-year-old's father revealed this week that La Liga's top three – Real Madrid, Atletico Madrid and Barcelona – had put offers on the table for his son's services.

While Castro admits he would not force Rakitic to stay, he claims the playmaker has had a significant contract offer from Sevilla and that the club do not need to cash in on their star man.

"The last offer we made to Rakitic was a significant percentage of our total budget," Castro told Sevilla's television channel.

"We made this offer because we want him to sign.

"We want to make sure that he stays, not that he leaves. We want the team to be strong and for all Sevillistas to enjoy it.

"We won’t make anyone stay who doesn’t want to be at Sevilla. Anyone who wants to walk through the door can do it, though it has to be at our price.

"We are relaxed and we have no need to sell."

Rakitic, whose current deal with Sevilla expires in 2015, is currently preparing for the World Cup with Niko Kovac's Croatia squad.