In terms of Article 29 of the Agreement, each of the contracting parties (Pakistan and Hong Kong) shall notify the other in writing of the completion of procedure required by its laws for bringing into force this agreement.
Under exchange of information provision of the agreement signed between Pakistan and Hong Kong, in no case contracting parties would decline to supply information solely because the information is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person.
The provisions of the said Agreement shall come into force from 24th November, 2017 and shall have effect: (a) in the case of Pakistan, (i) with regard to taxes withheld at source, in respect of amounts paid or credited on or after the first day of July next following the date upon which the agreement enters into force; and (ii) with regard to other taxes, in respect of taxable years beginning on or after the first day of July next following the date upon which the agreement enters into force. (b) In the case of the Hong Kong Special Administrative Region, in respect of Hong Kong Special Administrative Region tax, for any year of assessment beginning on or after the first day of April in the calendar year next following that in which the agreement enters into force.
The said agreement shall apply to taxes on income imposed on behalf of a contracting party or of its political subdivisions or local authorities, irrespective of the manner in which they are levied.
There shall be regarded as taxes on income all taxes imposed on total income, or on elements of income, including taxes on gains from the alienation of movable or immovable property, taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation. The existing taxes to which the agreement shall apply are in particular: (a) in the case of the Hong Kong Special Administrative Region, (i) profits tax; (ii) salaries tax; and (iii) property tax; whether or not charged under personal assessment; (b) in the case of Pakistan, (i) the income tax; and (ii) the super tax. The agreement shall apply also to any identical or substantially similar taxes that are imposed after the date of signature of the agreement in addition to, or in place of, the existing taxes, as well as any other taxes which a contracting party may impose in future. The competent authorities of the contracting parties shall notify each other of any significant changes that have been made in their taxation laws in relation to taxes covered by the agreement. The existing taxes, together with the taxes imposed after the signature of the agreement, are hereinafter referred to as "Hong Kong Special Administrative Region tax" or "Pakistan tax," as the context requires, the FBR added.