PRIME MINISTER OF PAKISTAN
PM thanks expats for success of RDAs
Different sources record that remittances sent to the country by Roshan Digital Accounts (RDAs), the latest initiative of Prime Minister Imran Khan Government to attract more foreign exchange, witnessed good response from Pakistan’s diaspora as remittances crossed $500 million by this new channel. Imran Khan thanked Pakistanis working abroad for supporting the government’s initiative as the momentum is picking up with more and more people opening digital accounts. So far, it is said that overseas Pakistanis across 97 states have opened up nearly 88,000 Roshan Digital Accounts. These Accounts facilitate Pakistan’s diaspora to invest in stock market and real estate, pay utility bills and also buy Naya Pakistan Certificates among other facilities. Khan also said: “I want to thank our overseas Pakistanis for responding so strongly to SBP’s Roshan Digital Accounts. 87,833 accounts opened from 97 countries around the world. $500 million sent to the country in just 5 months.” Imran said momentum continues to rise with $243 million coming in the last 6-week alone. Recently, State Bank of Pakistan (SBP) announced $2.3 billion remittances in January. It was 8th consecutive month of remittances staying above $2 billion market.
On the other hand, based on feedback from the diaspora and SBP recommendations, the Federal Government has introduced various amendments in the Income Tax Ordinance 2001 by Tax Laws (amendment) Ordinance 2021 to make the taxation regime simple, convenient and hassle-free for Non Resident Pakistanis (NRPs) maintaining Roshan Digital Accounts (RDAs). The amendments simplify and reduce the tax compliance cost for the NRPs maintaining RDAs, while the NRPs investing in Naya Pakistan Certificates (NPCs) by their RDAs are already under the full and final taxation regime, SBP news release said. The SBP also said the amendments enlarged the coverage of full and final taxation regime to dividends and capital gains on shares and mutual funds investments, besides capital gains on real estate investments made by the RDAs. “As a result, NRPs will not need to file tax returns against their income derived from investment made by RDAs under the above heads. With this removal of return filing requirements, NRPs having RDAs have also been insulated from penalties because of their absence from the Active Taxpayer’s List (ATPL). Further, NRPs with RDAs will not be subject to tax on cash withdrawals and bank transfers that were applicable on non-filers. The SBP said while the profit on debt on RDA deposits was tax exempt, the tax rate on profits on NPCs was 10 percent for both NRPs and resident Pakistanis having declared assets abroad, and 15 percent on dividends received from mutual funds and companies. The capital gains on shares and mutual funds, the State Bank said, were also taxed at 15 percent, the same rate that was applicable on filers. In addition, a tax of 1 percent of the value of the purchase/sale would be payable through NRPs both at the time of purchase and sale of real estate, which will be the full and final discharge of tax liability of NRPs against capital gains on real estate investments made through RDAs. Moreover, the simplification of the taxation regime was probable to give a further increase to the Roshan Digital Account scheme, which had already attracted considerable inflows from NRPs in the 5-month since it was introduced, SBP noted.
