Lahore: The Lahore High Court (LHC) has granted tax exemption status to the State Bank of Pakistan (SBP) on its immovable properties and assets located in cantonment areas, news sources reported on November 10.
The SBP had claimed tax exemption on its assets under Section 99(2)(f) of the Cantonments Act, 1924, according to the full decision of the provincial apex court. Hearing the SBP’s petition for the quashing of tax notices issued by the Chaklala Cantonment Board, an SBP representative claimed that the petitioner was entitled to a tax exemption because it was a corporation rather than a commercial entity such as the National Bank of Pakistan or any other commercial/scheduled bank or financial institution.
The SBP counsel also claimed that the central bank, by virtue of its powers and functions, was wholly owned by the federal government and performed functions on its behalf and that it was mentioned in the Fourth Schedule, Part I, Federal Legislative List at Item No. 28 of the Constitution, and that these functions were granted to the central bank through an amendment made to the act as well as other applicable laws.
It should be noted that the SBP is a federal government regulatory organisation that oversees banks and commercial DFIs. It possesses a variety of assets and properties around the country that are non-transferable and are the federal government’s permanent assets. The federal government properties are excluded from provincial and territorial tax regimes by law.
Nauman Ahmad is an imaginative Pisces whose love for literature and nature is unparalleled. When he's not reading or hiking, he's sleeping and eating, which gives him plenty of energy for his next adventure.
