Rates of withholding tax notified for cotton ginners

KARACHI: The Inland Revenue has notified the changes in withholding tax rates for cotton ginners as provided in the Income Tax Ordinance, 2001 effective from July 01, 2019.

The rate of income tax under Section 153(1)(a) for individual/AOP on ‘supply of goods’ is 4.5 percent for filers and 9.0 percent for non-filers.

The rate of income tax under Section 153(1)(b) for individual/AOP on ‘services’ is 10 percent for filers and 20 percent for non-filers.

The rate of income tax under Section 153(1)(b) for individual/AOP on ‘services of transport’ is 3.0 percent for filers and 6.0 percent for non-filers.

The rate of income tax under Section 153(1)(c) for individual/AOP on ‘contracts’ is 7.5 percent for filers and 15 percent for non-filers.

The rate of income tax under Section 233 for individual/AOP on ‘brokerage and commission’ is 24 percent.

The rate of income tax under Section 236Q for individual/AOP on ‘rent of machinery and equipment’ is 10 percent for filers and 10 percent for non-filers.

Assistant Commissioner Inland Revenue advised cotton ginners that as withholding agents they are required to deduct withholding taxes at the time of payment made and deposited the same into government exchequer on the same day tax is deducted as envisaged in Rule 43(a) of Income Tax Rules, 2002.

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