Islamabad:
Four days before the approval of RS435 billion tax measures announced in the budget, the government proposed a mini-dubbing of 36 billion rupees on Sunday and reduced restrictions on major purchases by people with insufficient assets.
The revised criteria aim to respond to public concerns concerning the negative impact of the previous general prohibition of economic activity by ineligible people.
With the introduction of a mini-budget before the planned approval of the 2025-20 year budget Thursday, the government imposed a total of new taxes worth 462 billion rupees. New taxes have been imposed on a day chicken and rates have been increased on business investment in common investment funds and investment in public debt.
The government has also agreed to relax the criteria for banning economic transactions such as the purchase of a house, a conspiracy, a car, investments in securities and the maintenance of a bank account by those whose declared assets do not support these purchases. He had proposed to prohibit all these transactions if the declared assets do not support these purchases.
The government has now proposed that the ineligibility criteria do not apply if the value of a car exceeds 7 million rupees. The ineligibility criterion would apply to the purchase of more than 100 million commercial rupees and more than 50 million RS Residential Property.
The condition of ineligibility will be applicable if the species of the bank account are greater than 100 million rupees per year in all the bank accounts of a person. The condition of ineligibility for stock market investment would be applicable, if the cumulative investment in one year is greater than 50 million rupees.
These limits have been established by assuming that the richest taxes in Pakistan, the richest and the rest of the 95%, have no economic muscles to make major investments.
The new tax measures were filed before the National Assembly Finance Committee, which approved the government’s proposals. Syed Naveed Qamar of PPP chaired the Committee meeting.
The Federal Office of Rété has proposed the measures of 36 billion rupees instead of reducing the rate of sales tax proposed on the import of the solar panel from 18% to 10% and the financing of an increase in wages of government employees at 10%.
In a decision that will further increase chicken prices in the country, the government has proposed to slap a right of federal excise equal to RS10 on an old chicken day. He proposed modifications to the Federal Excise Act of 2005 to introduce the new sample.
Last month, the International Monetary Fund (IMF) refused the government’s proposal to introduce a federal right of excise of 5% on the chicks for a day. The IMF representative stressed that, on the one hand, the FBR said that there were high taxes on food in Pakistan, and on the other hand, it recommended such proposals.
President FBR Rashid Langrial told the Standing Committee that the new RS36 billion tax measures aimed to compensate for the budget deficit due to the reduction in the rate of sales tax for solar panels and the financing of the increase in wages.
The procedure of the Standing Committee of the National Assembly has remained smoothly. Syed Naveed Qamar, Rashid Langrial and the newly appointed Minister of State for finances Bilal Kayani led the committee in the presence of a powerful opposition. It was for the first time that the year’s permanent committee discussed and approved the budget.
The two members of the National Assembly of the PTI ARIF Mobeen Jutt and Usama Mela played a very constructive role in the control of tax measures, which was also recognized by the Minister of Finance Muhammad Aurangzeb.
In the budget, the government had announced an 18% sales tax on the import of solar panels. After reaching an understanding with the Pakistani peoples party, Dar Vice-Prime Minister announced the reduction in the rate to 10%. The total turnover estimated compared to the 18% tax was 20 billion rupees, which is now planned for Rs12 billion.
Likewise, the FBR and the IMF had agreed to reduce the income tax rate of Rs 100,000 monthly salary income from 5% to 1%. The Ministry of Finance also offered a 6% increase in wages. Prime Minister Shehbaz Sharif decided to increase wages to 10% at the office of the firm took place an hour before the budget announcement.
The Prime Minister also decided in the same firm’s meeting as to finance the additional salary increase, the lowest panel tax should be increased to 2.5%.
Secretary Finance Imdadullah Bosal had opposed this tax to 2.5%. From now on, the income tax rate for the lowest income panel of 100,000 will be 1% and to finance the increase in salary, the government has taken three measures.
The Standing Finance Committee of the National Assembly has also agreed to increase the income tax rate from 25% to 29% on dividends received by a common fundraising company drawing income from debt.
He also proposed to increase the restraint to the reservoir of 15 to 20% on profits on investment in state securities by institutional investors.
The Minister of Finance, Muhammad Aurangzeb, had announced 435 billion rupees of new measures in the budget, in particular by introducing 2.5 rupees per line of carbon and up to 3% car engine tax. Of the 435 billion rupees, the tax measures linked to the FBR were RS312 billion.
After adjusting the negative impact of the solar panel tax, cumulatively, the government has imposed 462 billion rupees for a new tax measure in the budget. He set the annual tax objective of the FBR to RS14.13 Billion for the next financial year, which can be carried out at the rear of these measures and the application promised by the FBR.
Currently, there is 15% income tax in the case of investment funds, real estate investment trustee. It has now been decided that there will be 15% income tax in the case of the real estate investment trust, 25% in the event of common funds, subject to proportional income derived from average annual investments in debt securities and shares respectively and 29% of income tax on dividends received by a joint fundraising company drawing income from the profit.
Likewise, there will be 20% return on return or profit paid by a banking company or a financial institution on an account or deposit maintained with this company or institution; and 20% of the yield or profit on government titles paid to anyone other than an individual.
The Standing Committee of the National Assembly on Finance also approved the 2025-26 financial bill with certain recommendations, sent by the Permanent Finance Senatorial Committee as well as the recommendations of the NA finance committee.
The president of the FBR said that the government had shared six new tax measures with the IMF. Of these six measures, three were approved by the IMF.
The government has also decided that a uniform tax rate of 10% would be imposed on imported cotton and local cotton aimed at solving an anomaly that created problems for the local industry.
