Global money transfers: EC to deduct tax on payment of fees to operators

ISLAMABAD: Every exchange company licensed by the State Bank of Pakistan (SBP) must deduct tax at the time of payment of service charge or commission or fee to global money transfer operators, money transfer operators international money or any other person engaged in international money. cross-border money transfers or remittances to facilitate outward remittances.

According to the Finance Act 2022, published on Friday, where such person withholds a service charge, commission or fee, by whatever name called, from the amount payable to the exchange company on any account, the exchange company is deemed to have paid for the service. fee or commission or fee, whatever name is called and the exchange company must collect the fee accordingly.

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Any banking company, when paying any card network company or payment gateway or any other person any transaction or license fee or service or commission fee or fee under any name called or interbank financial telecommunications services, shall deduct tax at the rates set out in Section IV, Part I of the First Schedule: provided that, where the card network company or payment gateway or other person maintains money in connection with the above-mentioned services on the amount payable to the banking company on any account, the banking company is deemed to have paid the amount and the banking company will collect the tax accordingly, he said.

Copyright Business Recorder, 2022