LAHORE: The Punjab Assembly has halted the enforcement of revised agricultural income tax rates, declaring recent government notifications unlawful and ordering an immediate suspension of all related assessments and collections.
The ruling was issued by Speaker Malik Muhammad Ahmad Khan during the Assembly’s 41st session while hearing a privilege motion moved by lawmaker Zulfiqar Ali Shah.
The Speaker observed that the notifications lacked legal validity as they were not presented before the Assembly in accordance with statutory requirements. He directed the Excise and Taxation Department to immediately stop implementing the revised rates and instructed the provincial government to table the notifications within 15 days, along with a detailed explanation for the procedural lapse.
The matter has also been referred to the Assembly’s Committee on Law Reforms and Delegated Legislation, which has been tasked with determining responsibility and submitting its findings within one month.
The controversy stems from notifications issued on March 5, 2025, revising agricultural income tax rates, followed by another notification on September 10, 2025, which sought retrospective application from July 1, 2025.
According to the mover of the motion, the notifications were not laid before the Assembly during the 2025–26 budget session, as required under Section 11(2) of the Punjab Agricultural Income Tax Act, 1997.
In his ruling, the Speaker emphasised that taxation powers rest solely with the legislature under the Constitution, and any delegated authority must strictly follow prescribed legal procedures. He stated that failure to present such notifications before the Assembly renders them ineffective and without lawful basis.
Calling the omission a breach of parliamentary privilege, the Speaker underscored the importance of legislative oversight in fiscal matters. He further directed that all future changes to agricultural income tax rates must be introduced during the annual budget session.
The ruling also noted that affected taxpayers may pursue legal remedies regarding any recoveries made under the now-invalid notifications.
