ISLAMABAD: Federal Board of Revenue has clarified that the incomes of the President of Pakistan, Federal Ministers, Chief of Staff of Pakistan Armed Forces and the Corps Commanders are taxable.
A news item was published in certain newspapers attributing to the FBR Chairman that there is no tax on the income of the country’s aforementioned top administrative posts. FBR has clarified that this impression is based on a misunderstanding.
A press release stated that in fact, the Chairman had just said that some of the perquisites and allowances of certain persons occupying very senior positions enjoy tax exemption under the law. In order to fully clarify the position the related legal provisions as contained in Part-I of the Second Schedule to the Income Tax Ordinance, 2001 are narrated below:
(51) The perquisite represented by the right of the President of Pakistan, the Provincial Governors and the Chiefs of Staff, Pakistan Armed Forces to occupy free of rent as a place of residence any premises provided by the Government.
(52) The perquisite represented by free conveyance provided and the sumptuary (entertainment) allowance granted by Government to Provincial Governors, the Chiefs of Staff, Pakistan Armed Forces and the Corps Commanders.
(53) The following perquisites and allowances provided or granted by Government to the Ministers of the Federal Government, namely:-
(a) Rent-free accommodation in so far as the value thereof exceeds ten per cent of the basic salary of the Ministers concerned;
(b) House-rent allowance paid by Government in lieu of rent-free accommodation in so far as it exceeds five hundred and fifty rupees per month;
(c) Conveyance;
(d) and Allowance.
Apart from the above, their salaries and other allowances are taxable.
