ISLAMABAD: Teachers and researchers have availed tax exemption to the tune of Rs2.42 billion on their income during Tax Year 2020.
According to official sources, under Clause 1(2) of Part 3 of the Second Schedule of Income Tax Ordinance, 2001, full time teachers or researchers are entitled for reduction in tax liability since 2006 and there is no sunset clause attached to this concession.
The FBR said that the tax payable by a full time teacher or a researcher, employed in a non profit education or research institution duly recognized by Higher Education Commission, a Board of Education or a University recognized by the Higher Education Commission, including government research institution, shall be reduced by an amount equal to 25 percent of tax payable on his income from salary.
Data of teachers is taken from Pakistan Bureau of Statistics (PBS) website, for the following categories of teachers: Arts/Science colleges, professional colleges, universities, secondary vocational institutions. Teachers in secondary schools have not been considered, being relatively less paid.
Latest available data is for year 2017. For 2018, an 8 percent multiplier on number of teachers is used keeping in view increase in number of teachers over past years.
Average annual salaries for different categories of teachers have been taken as following:
– Arts/Science College: Rs. 900,000
– Professional College: Rs. 1,200,000
– University: Rs. 2,400,000
– Secondary vocational institutions: Rs. 1,800,000
Separate data for researchers is not available, the FBR said.
The FBR said that approximate 133,255 teachers and researchers had availed the tax concession.
