ISLAMABAD: With extending the lower income limit for imposing a 10% super tax, the federal government has started implementing the Finance Act 2023 from July 1, 2023 (Saturday).
As per the Finance Act shared by the Federal Board of Revenue (FBR) on its website, 10% of the income tax will be applicable where income exceeds Rs500 million.
With a focus on “economic stability”, the federal government has introduced three more slabs for the wealthy people paying super tax in the Finance Bill 2022-23.
The government imposed a 6% super tax on individuals earning between Rs350 million and Rs400 million annually. Under the bill, 8% of the income tax will be charged to those between Rs400 million and Rs500 million.
Dar unveiled Rs14.46 trillion budget
On June 9, Finance Minister Ishaq Dar unboxed a Rs14.46 trillion budget for the fiscal year 2023-24, introducing “no new taxes” and envisaging an economic growth of 3.5% as the crisis-riven country looks to persuade the International Monetary Fund (IMF) to release more bailout money.
Pakistan has shared the budget numbers with the IMF, and the finance minister believes there are no further objections the lender could raise — as the country is in line with the programme requirements.
Dar — who presented the second budget of the Pakistan Democratic Movement-led government, which came into power in April last year, in the National Assembly and Senate — returned to the podium to announce the federal budget after a hiatus of five years.
Key takeaways of budget
No increase in duties on the import of essential items.
Customs duties on raw materials of diapers, sanitary napkins exempted.
Payments made through credit/debit cards to restaurants/resorts to be taxed at 5%.
Filing of sales tax return for availing concessionary fixed tax rate of 0.25% for IT & ITeS exports not required anymore.
Five-year tax holiday announced for agro-based industries being SMEs set up on or after July 1, 2023, from tax year 2024 to tax year 2028.
Customs duties exempted on specific papers and art cards and board used for printing of Holy Quran.
Incentive for exporters of IT and IT enabled services by allowing duty free import of IT related equipment equivalent to 1% value of their export proceeds.
Withdrawal of capping of the fixed duties and taxes on the import of old and used vehicles of Asian Makes above 1,300cc.
Sales tax on contraceptives and accessories exempted.
The requirement of shop area for tier-1 retailers proposed to be withdrawn.
