All Authorised Dealers
in Foreign Exchange,

Dear Sirs,

RELEASE OF FOREIGN EXCHANGE FOR TRAVEL ABROAD – LEVY OF 5% TAX

Attention of Authorized Dealers is invited to F.E. Circular No.51 dated the 28^th June, 1993 in terms of which 5% withholding tax is required to be collected at the time of release of foreign exchange for travel abroad except for Hajj and Umrah or official tour.

2. It has since been clarified by the Revenue Division that advance income tax @ 5% under sub-section (5B) of Section 50 of the Income Tax Ordinance, 1979 is not deductible from the foreign exchange released to the Government employees for medical treatment abroad.

3. The reference to Schedule E4/P4 made in Para 1 of the aforesaid F.E. Circular may be changed to Schedule E3/P3.

4. Please bring the above to the notice of your constituents concerned.