By Staff Reporter
ISLAMABAD: The government is brainstorming ways and means to wring more taxes out of salaried/business class, high earners and sectors like tobacco, beverages, steel, etc before closing the budget document for next fiscal.
All this to jack up the FBR’s tax collection target by Rs438 billion from Rs7.004 trillion to Rs7.442 trillion for FY2023 to seal a deal with the IMF.
Top official sources said that different proposals are on the budget-makers’ table to increase taxation on the already burdened taxpayers.
Federal Minister for Finance and Revenue Miftah Ismail is scheduled to deliver a windup speech in the National Assembly on Friday (today) and is expected to announce additional taxation measures.
The government is considering bringing major changes in Section 7E for imposing a tax on deemed income, whereas the immoveable property has been excluded and capital asset has been inserted [in the law] because the former might have been challenged in superior courts.
Under Section (7E) of the Income Tax Ordinance, a tax shall be imposed at the rates specified in Division VIIIC of Part-I of the First Schedule on the income specified in this section, for the tax year 2022 and onwards.
A resident person shall be treated to have derived as income chargeable to tax under this section an amount equal to five percent of the fair market value of capital assets situated in Pakistan excluding one capital asset under self-occupation owned by the resident person; self-owned business premises from where the business is carried out by the persons appearing on the active taxpayers’ list at any time during the year; self-owned agriculture land where agriculture activity is carried out by person excluding farmhouse and land annexed thereto; any constructed property in respect of which the completion certificate has been obtained from the concerned authority; any under-construction property in respect of which construction plan, development plan or a layout plan has been approved by the concerned authority; where the fair market value of the capital assets in aggregate excluding the capital assets mentioned in clauses (a), (b) and (c) does not exceed rupees twenty-five million; capital assets owned by a provincial government, a local government, a local authority; land development and construction projects registered with Directorate General of designated non-financial businesses and professions; or any property from which income is chargeable to tax under section 15 of the Ordinance and tax leviable is paid thereon.
The federal government may include or exclude any person or property for the purpose of this section. In this section “capital asset” means property of any kind held by a person, whether or not connected with a business, but does not include any stock-in-trade, consumable stores or raw materials held for the purpose of business; any shares, stocks or securities; any property with respect to which the person is entitled to a depreciation deduction under section 22 or amortisation deduction under section 24; or any movable asset not mentioned in clauses (a), (b) or (c) above.
For a resident person, it is proposed that being a citizen of Pakistan who during the tax year is present in any other country for less than 183 days or who is not a tax resident of any other country.
The salary slabs for income earning from Rs50,000 to Rs100,000 a tax rate of 2.5 percent has been proposed. On the salary income from Rs100,000 to Rs 200,000, the proposed rate has been jacked up from 7.5 percent to 10 percent. The rates of all other slabs have also been revised upward.
The government is all set to impose one percent Income Support Levy on people and companies earning Rs150 million a year, 2 percent on those having income of Rs200 million, 3 percent additional rate has been proposed for the Rs250 million annual income earners and 4 percent for an income of Rs300 million/year.
In the budget 2022-23, the government proposed a 2 percent rate for only those earning over Rs300 million a year to add additional Rs38 billion revenue into the national kitty.
Meanwhile, the FBR through an SRO slapped a Regulatory Duty on the import of petrol. In exercise of the powers conferred by sub-section (3) of section 18 of the Customs Act, 1969 (IV of 1969), the federal government is pleased to levy regulatory duty at a rate of ten percent on import of motor spirit (PCT code 2710.1210) with the stipulation that the regulatory duty shall not be levied on cargoes for which LCs had already been opened or were anchored in the high seas.
The imports of motor spirit where customs duty at a rate of ten per cent is paid shall be exempted from the levy of regulatory duty. This notification shall remain in force till June 30, 2022.
Copyright © 2021 Independent Pakistan | All rights reserved
