Federal Board of Revenue (FBR) Clarifies Sales Tax Collection Mechanism on Advertisements | Pakistan Press Foundation (PPF)

Pakistan Press Foundation

Federal Board of Revenue (FBR) Clarifies Sales Tax Collection Mechanism on Advertisements

Pakistan Press Foundation

The Federal Board of Revenue (FBR) has legally clarified the sales tax collection mechanism between federations and provinces on the services of advertisements on TV, cable TV, website or webpage or internet, radio, closed-circuit TV, TV broadcast through satellites, still media including billboards, sign boards, digital boards and advertisement on cinema screens.

Under the Islamabad Capital Territory (Place of Provision of Services) Rules, 2023, the FBR’s rules shall extend to the Islamabad Capital Territory. They shall apply in case of the taxable services as specified in these rules and are provided or rendered or received in the Islamabad Capital Territory. They shall take effect on and from May 1, 2023.

The rules said that where the advertisement is booked at any place in ICT for broadcasting on channels beamed for uplinked from a place outside Pakistan, the services of the advertisement shall be deemed to have been provided in ICT, irrespective of the fact whether or not the channel has PEMRA’s landing rights permission in Pakistan and, similarly, where the advertisement is booked at any place in ICT for placing on the web or internet of persons not resident in Pakistan, the place of provision of service shall be the location of the person booking such advertisement for such non-resident owner of the web or internet.

In case of advertisements on TV broadcast through satellites, the place of provision of service shall be the location of the beaming station, i.e. the broadcast station uplinking the advertisement content. Broadcast through terrestrial signals, the place of provision of services shall be the location of the first broadcast station: Provided that in case of an advertisement on TV channels having landing rights in Pakistan, the place of provision of service shall be the location of the person having PEMRA license for such landing rights in Pakistan.

In case of an advertisement on Internet protocol TV (IPTV), the place of provision of service shall be the location of the licensing zone as specified in the respective PEMRA license for IPTV.

In the case of an advertisement on cable TV or the TV using other distribution services, the place of provision of service shall be the location of the area of coverage assigned to the -person holding the respective PEMRA license for cable TV or the TV using other distribution services.

In case of advertisements on TV broadcast through satellites, the place of provision of service shall be the location of the beaming station i.e. the broadcast station uplinking the advertisement content; and broadcast through terrestrial signals, the place of provision of services shall be the location of the first broadcast station: Provided that in case of an advertisement on TV channels having landing rights in Pakistan, the place of provision of service shall be the location of the person having PEMRA license for such landing rights in Pakistan.

In case of an advertisement on Internet Protocol TV (IPTV), the place of provision of service shall be the location of the licensing zone as specified in the respective PEMRA license for IPTV. In case of an advertisement on cable TV or the TV using another distribution service, the place of provision of service shall be the location of the area of coverage assigned to the person holding the respective PEMRA license for cable TV or the TV using other distribution services.

In case of an advertisement on closed-circuit TV, the place of provision of service shall be the location of the closed-circuit TV system. In case of an advertisement on a website or webpage or internet, the place of provision of service shall be the location of the person owning or managing such website or webpage or internet.

In case of an advertisement on radio broadcast through satellites, the place of provision of service shall be the location of the broadcast station uplinking the advertisement content.

In case of an advertisement on radio broadcast through terrestrial signals, the place of provision of service shall be the location of the first broadcast station. In case of an advertisement on still media including billboards, sign boards, digital boards, poles, etc., the place of provision of service shall be the location of such still media.

In case of an advertisement on cinema screens and advertisement through aerial banner towing or smoke writing, the place of provision of service shall be the location of the cinema house and the jurisdiction in which the aerial advertising is performed, as the case may be, FBR added.

Source: Pro Pakistani


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