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Pakistan

Honoraria for NA, Senate staff but no change in tax rates for salaried group as Aurangzeb wraps up budget discussion

  • Finance minister Aurangzeb says reduced sales tax to continue to apply on Hybrid Electric Vehicles, stationary items to remain exempted
Published June 25, 2024

Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb on Tuesday wrapped up discussions on the Federal Budget 2024-25 in the National Assembly, maintaining higher tax rates on the salaried group, and announcing an honoraria amounting to 3-month basic pay for the staff and officers of the National Assembly and Senate.

Budget 2024-25 is based upon a homegrown reform plan under which the government wants to pull the country out of the current economic situation and for this economic reforms are needed,” said Aurangzeb as he began the discussion.

He said the government aims to increase the tax-to-GDP ratio to 13%, pursue the privatisation programme, and implement SOE and energy sector reforms.

The finance minister said the government intends to prioritise the private sector, correct the incentives and shift from a government-led to market-driven economy.

“On the income tax front, before blocking mobile SIMs and banning international travel for non-filers, they will be provided an opportunity of a personal hearing.

“Under Section 116, an explanation will be included in the declaration of foreign assets and assets of spouse, in case of spouse being dependent on the taxpayer.

Fear comes alive: all salaried persons earning over Rs50k a month to bear higher taxation in FY25

He said stationary items will continue to be exempted to sales tax – contrary to the earlier announcement when GST was enhanced on this head.

Moreover, the current reduced sales tax rate will continue to apply on HEVs (Hybrid Vehicles) mentioned in Schedule 8 and Serial No 73.

“Under EFS 2021, zero rating on local supplies will continue,” he said.

These changes come after the Senate on Monday made 128 recommendations to the National Assembly for legal changes and amendments in the Finance Bill, 2024, including the restoration of certain exemptions and reduced tax rates on essential commodities, goods, and services.

The Senate sent the proposals to the National Assembly on the recommendation of the Standing Committee on Finance. The Standing Committee on Finance finalised the recommendations after a daylong session of the committee held at the Parliament House.

On Tuesday, the finance minister said that under the directives of Prime Minister Shehbaz Sharif, the government has tried to protect “as much as possible” the agriculture, health, education and renewable energy sectors.

He said retailers should be part of the tax net for which strict measures need to be taken.

“For non-filers, we have decided to heavily increase tax rates under Section 236G and Section 236H, which will be implemented from July 1, 2024 on all sectors,” he said.

“Time has come to take strict action against retailers who do not participate in the FBR’s Tajir Dost scheme.”

Aurangzeb also lauded the role of armed forces and said national security remains the top priority of the government.

“Through the Special Investment Facilitation Council (SIFC), we have witnessed announcements from friendly countries especially Saudi Arabia and the UAE. We are optimistic on hearing good news in the coming days,” he said.

On the International Monetary Fund (IMF), the finance minister said the government intends to make the upcoming programme the last bailout of the country.

While concluding his address, Aurangzeb announced an honoraria amounting to 3-month basic pay for the staff and officers of the National Assembly and Senate.

Comments

200 characters
KU Jun 25, 2024 04:10pm
FM is at least 2 days behind the robust FBR. Unemployed, daily wagers, n students, have already received sms on SIM closures if they don't become tax filers. Primates rule la la land, ce la vie!
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Fazal Jun 25, 2024 04:17pm
The Government should immediately cut off their expenses and heavy protocols. Agreement with IPPs to be terminated as most of money collected on taxes are going to IPPs.
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KU Jun 25, 2024 04:55pm
The Royal Court decree is announced, ''banish the citizens to gallows''. The law makers n breakers ignore the misery of salaried class yet shower themselves for nuisance value. Surely, its pathetic.
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Sarwar Jun 25, 2024 05:24pm
@Fazal , agreements should never be terminated. Who will invest invest in the country if we keep terminating contracts after making them. We wasted so much time in Reno did too because of this mindset
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Pakistani Jun 25, 2024 06:00pm
"Aurangzeb announced an honoraria amounting to 3-month basic pay for the staff and officers of the National Assembly and Senate."? Why?
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Pakistani Jun 25, 2024 06:06pm
Many non filers are Overseas Pakistanis. paying 30% WHT deposit income. Don't make their life difficult. Recognize Overseas Pakistani status through NICOP and avoid punishing them.
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Zeeshan Ahmed Jun 25, 2024 06:33pm
Feudal Lords should not be ignored. Tax on Agriculture income be composed, the rest is eyewash.
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sahn Jun 25, 2024 06:46pm
instead of reducing the government expenditures, honoraria to specific employees and reduced tax rates/exemptions for special class will only create further disparity..........
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Bill Jun 25, 2024 06:46pm
So the royal prince has spoken against salaried class without given any logical reason for this horrendous increase..... Like govt cares for middle class of this state
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Rizwan Zahoor Jun 25, 2024 07:14pm
Where our taxes go, ministries establishment high officials spend our taxes on their levish life style why free petrol electricity big cars to government officials
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AAN Jun 25, 2024 07:33pm
Nice move cutting expenses by paying three months extra basic salary to senate and NA staff! What a joke.
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Maqbool Jun 25, 2024 07:35pm
Why: honoraria amounting to 3-month basic pay for the staff and officers of the National Assembly and Senate? Then declare a three months Tax holiday on all Salary employee of private sector also
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Taruq sultan Jun 25, 2024 08:10pm
Finance minister speech is prepared in washington
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M Ahsen Javed Jun 25, 2024 09:45pm
Federal Government is trying to increase the Development Budget which is a good step. However, they must focus on reducing their costs including Defence and on running the Civil Government. They must also do the necessary legislation for devolving public money down to the local governments from provinces.
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