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Print

Rs300bn taxation measures thru Ord on the way

  • FBR drafts proposals of new taxation measures to be enforced through the promulgation of the Tax Laws Amendments Ordinance, 2023
Published January 26, 2023
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ISLAMABAD: The Federal Board of Revenue (FBR) has drafted proposals of new taxation measures of nearly Rs300 billion to be enforced through the promulgation of the Tax Laws Amendments Ordinance, 2023.

Sources told Business Recorder on Wednesday that the Ordinance is expected to be promulgated during the next 7-10 days.

Initially, the revenue impact has been worked out at Rs200 billion, which has been raised to Rs300 billion. The revenue impact of the proposed withholding tax on banking transactions of non-filers is nearly Rs45 billion.

The three percent flood levy could generate additional revenue of Rs60 billion.

The proposed increase in the rates of capital value tax rates on imported and locally-assembled vehicles has been estimated to generate an additional revenue of Rs10 billion.

The proposal to impose tax on banks’ foreign exchange income has been estimated to generate Rs20 billion.

The proposal to raise the Federal Excise Duty (FED) on sugary drinks would generate Rs60 billion. The proposed impact of further raise in the FED on cigarettes has been estimated at Rs25-30 billion.

FBR sees Rs1289bn tax gap for 2022

The proposed increase in the rate of advance tax on the purchase/sale of the immoveable property would generate about Rs20-30 billion.

The proposed withdrawal of sales tax exemption on the import of raw materials/inputs used in the manufacturing of export goods under the “export facilitation scheme” has a revenue impact of Rs20-25 billion.

The said proposals are under discussion between the FBR and the Ministry of Finance but have yet not been finalised. After approval of the proposals, the Presidential Ordinance would be promulgated, sources added.

The government under the contingency revenue measures agreed with the International Monetary Fund (IMF) to increase FED on sugary drinks/cigarettes and withdrawal of sales tax exemption to the exporters if a month’s revenue collection data underperformed.

Copyright Business Recorder, 2023

Comments

1000 characters
Tariq Qurashi Jan 26, 2023 10:37am
The desire of any government should be to have as many business transactions as possible go through banking channels. A tax on bank transactions for non-filers will have a negative effect in that transactions will move towards cash and bypass the banks. Also removing the sales tax exemption on raw materials will make our exports more expensive; not what you want when you are short of dollars! Immovable properties have already been taxed heavily in the present budget, additional taxes will have an additional negative effect on the construction industry. These seem to be desperate measures that are not that well thought out.
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Javed Jan 26, 2023 11:54am
I would not object to paying additional taxes if the burden would be shared by reducing perks , salaries and allowances of those imposing this hardship on the general public , sadly there is no move to do that in fact the PM has announced extra discretionary funds to our one sided parliamentarians, this is a travesty and the public should object. Germany is a rich and developed nation and a small increase in petrol prices brought the public to react forcing the government to backtrack.
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عبدالله Jan 26, 2023 02:55pm
اس کا مطلب مزید مہنگائی اور اس کا نتیجہ مزید کاروبار تباہ اوراس کا نتیجہ مزید ٹیکس کلیکشن میں کمی
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Mushtaque Ahmed Jan 26, 2023 10:17pm
Agriculture sector enjoys nominal tax. When will Pakistan tax the landlords?
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