ISLAMABAD: The new income tax slabs for the salaried class under the amended Finance Bill 2023 revealed that higher rate of income tax would now be applicable where annual taxable income exceeds Rs.2, 400,000.

According to the amended Finance Bill 2023 issued by the Federal Board of Revenue (FBR) on Sunday, where taxable income exceeds Rs.2,400,000 but does not exceed Rs.3,600,000, the rate of tax would be Rs. 165,000 + 22.5% of the amount exceeding Rs.2,400,000.

There is no change in the income tax rates for salaried individuals where taxable income exceeds Rs.1,200,000 but does not exceed Rs.2,400,000, the rate of tax would remain at Rs. 15,000 + 12.5% of the amount exceeding Rs.1,200,000.

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Under the new slab, where taxable income exceeds Rs.3,600,000 but does not exceed Rs.6,000,000, the rate of tax would be Rs 405,000 + 27.5% of the amount exceeding Rs.3,600,000.

The revised income tax slab for salaried class revealed that where taxable income exceeds Rs.6,000,000, the rate of tax would be Rs 1,095,000 plus 35 percent of the amount exceeding Rs 6,000,000.

The amended Finance Bill 2023 has also increased income tax on the income of individuals and association of persons (AOPs) except a salaried individual.

The revised slabs for the individuals/AOPs revealed that where taxable income exceeds Rs. 600,000 but does not exceed Rs. 800,000, the rate of tax would be 7.5% of the amount exceeding Rs. 600,000.

Where taxable income exceeds Rs. 800,000 but does not exceed Rs. 1,200,000, the rate of tax would be Rs15,000 + 15% of the amount exceeding Rs.800,000.

Under the next slab, where taxable income exceeds Rs.1,200,000 but does not exceed Rs. 2,400,000, the rate of tax would be Rs.75,000 + 20% of the amount exceeding Rs.1,200,000.

Where taxable income exceeds Rs.2,400,000 but does not exceed Rs. 3,000,000, the rate of tax would be Rs 315,000 plus 25 percent of the amount exceeding Rs.2,400,000.

Under the new slab, where taxable income exceeds Rs.3,000,000 but does not exceed Rs. 4,000,000, the rate of tax would be Rs.465,000 + 30% of the amount exceeding Rs.3,000,000. Where taxable income exceeds Rs.4,000,000, the rate of tax would be Rs 765,000 plus 35 percent of the amount exceeding Rs.4,000,000, new slab added.

Copyright Business Recorder, 2023