ISLAMABAD: The government has announced a set of new revenue measures for the budget 2024-25, with a special focus on strict enforcement including imprisonment for traders, who would fail to register with the Tajir Dost Scheme.

As per new Finance Bill 2024, the penalty of sealing of shop is being proposed for traders and shopkeepers who fail to register under a scheme such as Tajir Dost Scheme. Further, failure to register by a shopkeeper or trader is proposed to be made an offence punishable on conviction with imprisonment for six months or with fine, or both.

The changes made through Finance Bill 2024 are in line with the new enforcement and administrative measures. However, the government has also proposed to increase the tax burden on personal incomes, particularly for the salaried class.

A tax expert explained that the exemption limit of salaried class has remained unchanged for the past three years. In the past two years, the tax rate in the first two slabs has also remained unchanged. However, the government has proposed drastic changes that directly impact salaried individuals.

Under the Finance Bill 2024, the tax rate for salaried individuals earning monthly salaries between Rs50,000 to Rs100,000 has been raised. The proposed increase would see the tax incidence go up from 2.5 percent to 5 percent. This significant rise in tax liability will impact employees who fall into this category.

The individuals earning a monthly income between Rs100,000 to Rs200,000 will be significantly impacted by the tax changes. The tax rate for this category has been increased to 15 percent from 12.2 percent, and a fixed amount of Rs30,000 has been raised from Rs15,000.

In case of individuals earning between Rs200,000 to Rs366,000 per month, the tax rate has been raised from 22.5 percent to 25 percent. Additionally, the fixed tax amount has been increased from Rs165,000 to Rs180,000. In case the monthly income range of Rs266,000 to Rs342,000 now falls under a higher tax rate of 30 percent, up from the previous rate of 27.5 percent. Furthermore, the fixed tax rate has also been raised to Rs430,000 from Rs300,000. The income limit of the upper two slabs has been reduced, which will increase the tax liability for the salaried class with low income. As a result, this category is widened to bring more salaried individuals under it. The tax rate of 35 percent will now be applied to a monthly salary of Rs342,000, which was previously for Rs1 million per month. On the other hand, the salaried class will see a reduction of Rs395,000 in the fixed amount falling under this top category.

Moreover, there are changes proposed in the taxable slabs for non-salaried individuals, with tax rates increasing progressively from 15 percent to 45 percent.

Copyright Business Recorder, 2024


Comments are closed.