LAHORE: The Punjab government through the Finance Bill tabled in the assembly, taxed the rich by introducing tax on big houses, doubling the annual token taxes on the 1300cc and above vehicles and imposing annual tax on imported vehicles of 1590cc and above.
The provincial government has also increased stamp duty by one percent on immoveable property including more services to expand the scope of GST.
As per details, the provincial government has levied a tax of Rs150,000 per kanal on two to eight kanal residences. For residences exceeding 8 kanal, the tax would be Rs200,000 to 300,000 per kanal. The luxury cars over 1600 cc have been slapped with luxury token tax.
On the other hand, agriculture has again been spared from agriculture income tax. The rate for agriculture income tax was fixed in 1997, but the same rates still apply on farmers having more than 12.5 acres of land.
In the same way many lucrative services have not been included in the provincial sales tax. Experts point out that the tax can be charged on the import of services, including communications, construction services, financial services, IT services, royalties and licence fees and other business services. It has the potential to generate around Rs20 billion additional revenues.
Similarly, exemptions on technical, software and engineering consultants; travel agents, cars/automobile dealers (via companies) , cable TV operators have not been removed. There was a need to introduce Withholding Tax (similar to those in the ITO) on technical fees, services, contracts and commissions and levy a presumptive tax on hard-to-tax services.
While levying tax on luxury houses, the Punjab finance minster did not include the more luxurious from houses that remain exempted from urban property tax. On the other hand, some more services have been added by amending the Punjab Sales Tax on Service Act 2012. Specialised workshops, repair and maintenance, indenting/brokerage, call centres, lab services (other than pathological and diagnostic), physical fitness services, laundry and dry cleaning, cable TV, TV/Radio programme production and print media advertisements (reduced rate of 5 percent) are included in the GST under the amendment.
