Discontinuance of Gas and Electricity Connections

Discontinuance of Gas and Electricity Connections via Section 14A: By virtue of newly inserted Section 14A, FBR is now empowered to direct the gas and electricity distribution companies to discontinue respective utility connections of following categories of persons through Sales Tax General Orders [STGOs].

➢ Tier-1 retailers who are registered but not integrated  with Board’s Computerized System.

However, such utility connections may be restored by Board through STGOs provided such defaulters comply with aforesaid requirement.

We understand that this amendment would have far-reaching effect in broadening tax net base in the country. Simultaneously, the amendment may also cause business hurdles for unregistered persons and non-integrated Tier-1 Retailers.

In past, Board had vested powers to award sales tax zero-rated electricity and natural gas facility to registered persons of five export-oriented sectors. Empowering Board once again to discontinue and reinstate utility connections of businesses through issuance of STGOs would lead to discontentment and chaos for businesses across the country.

Certain amendments through third amendment ordinance and this Ordinance shall be called the Tax Laws (Third Amendment) Ordinance, 2021.

For more information on FBR’s new regulations / circulars/ SROs/ amendments in taxation laws in Pakistan please visit https://www.fbr.gov.pk/

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