Tax on deemed income basis: BHC asks why FBR has different policies for Punjab and Balochistan

ISLAMABAD: Balochistan High Court (BHC) has directed the Federal Board of Revenue (FBR) to explain why Section 7E (tax on deemed income basis) has been suspended for Punjab, but the said policy has not been extended for Balochistan despite a stay order.

According to the directions of the BHC to the FBR, the attorney general should inquire from the chairman FBR why entirely different policies have been adopted for two different parts of the country (Punjab and Balochistan), whereby, the provision of deemed tax has been suspended for Punjab, but on the other hand, despite granting stay order by this court, the said policy has not been extended for Balochistan.

Since it required immediate consideration by the chairman FBR, therefore, the office of the Attorney General shall ensure the compliance of the court order.

Section 7E: Sindh High Court grants stay for TY2023 subject to 50% payment

As per the FBR’s circular 3 of 2023, the FBR has implemented the judgment of the Lahore High Court (LHC) on Section 7E (tax on deemed income basis) of the Income Tax Ordinance 2001 and now Section 7E will not apply to cases (filers/ non-filers) falling within the jurisdiction of the LHC.

The FBR has abolished the condition of obtaining exemption certificates from the commissioner Inland Revenue from different categories of taxpayers including non-resident persons under Section 7E of the Income Tax Ordinance, 2001.

Copyright Business Recorder, 2023