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Govt considering to re-impose income tax slabs of 2017-18 to collect additional revenue

Govt considering to re-impose income tax slabs of 2017-18 to collect additional revenue

ISLAMABAD: Ministry of Finance is considering to re-impose income tax slabs of 2017-18 to collect the additional revenue of Rs100 billion. Pakistan Tehreek-e-Insaf government is set to give blow to salaried class in upcoming budget. Government apart from introducing new taxes, is likely to end tax exemptions to salaried individuals earning Rs400,001 to Rs1.2 million per annum.

According to sources, the Ministry of Finance, while preparing the next budget, is considering to re-impose the income tax slabs of 2017-18 that included income tax rates from 2pc to 35pc plus a fixed amount of tax.

While presenting the last budget, the Pakistan Muslim League-Nawaz government had introduced income tax exemptions to those earning Rs400,001 to Rs1.2 million per annum. However, it later added a fixed amount of Rs1,000 for individuals earning Rs400,001 to Rs800,000 and Rs2,000 for the annual income of Rs800,001 to Rs1.2 million per annum.

The fixed tax of Rs1,000 and Rs2,000 was introduced to avoid reducing the number of filers (1.26 million). In case the tax slabs are reversed, the government will be collecting an additional revenue of Rs100 billion, which was lost due to exemptions introduced by the previous government in April 2018.