ISLAMABAD: The federal government has imposed Rs440 billion new taxes with a focus on real estate sector, in the budget for next fiscal year 2022-23.
In a media briefing, FBR Chairman Asim Ahmad informed that Federal Board of Revenue has proposed to impose Rs440 billion new taxes, which include Rs34 billion Customs duties, Rs90 billion Sales Tax and Federal Excise duty and Rs316 billion income tax.
He also said that FBR has proposed to give relief tune of Rs85 billion in taxes to masses in next fiscal year. The net effect of the taxes would be Rs355 billion.
According to Finance bill, government has proposed Rs316 billion new income tax measures for next fiscal year.
The chairman said the FBR has proposed to impose 5% tax on income on non-productive immoveable as well as un-utilized residential/commercial/industrial plots and farm house.
The FBR will give exemption of one property but it will deduct Rs25 million from other open plot, adding that FBR will collect Rs30 billion through this proposal.
He also said that FBR has also proposed to increase 15 % capital gain tax from four to six years on immoveable property and it is projected that we will collect Rs40 billion revenue.
The chairman said that FBR has also proposed an increase in advance tax on purchase of immoveable property for non-filers from existing 2% to 5% and 1% to 2% for filers. He also informed that we will be able to collect Rs65 billion revenue in next year.
Asim ahmad said that FBR has also proposed 1percent capital value tax from Pakistani living abroad on their foreign immoveable properties as well as liquid foreign assets. We have estimated that we will collect Rs18 billion tax from Pakistani living abroad.
Asim ahmad said that FBR has proposed to enhance advance Income Tax above 1600 cc Luxury Vehicles.
There will be Rs150,000 advance tax on 1601cc to 1800cc vehicles, Rs200,000 on 1801cc to 2000cc, Rs300,000 on 2001cc to 2500cc, Rs400,000 on 2501cc to 3000cc and Rs500,000 advance tax on above 3000cc vehicles.
It is estimated that FBR will collect Rs10 billion taxes by this proposal.
FBR has proposed Rs3000 to Rs50, 000 per month fixed tax for retailers (other than Tier-1) on electricity consumption.
Retailers will pay Rs3,000 per month up to monthly electricity bill of Rs30,000, Rs5,000 per month up to electricity bill of Rs50,000, Rs10,000 per month up to electricity bill of Rs100,000, Rs50,000 per month for special class including car dealers, precious watches as final tax liability on income & sales tax, he explained.
FBR will also collect 2% Poverty Alleviation Tax on high earnings of all persons (Individuals, businesses,) income above Rs300 million.
On the other hand, FBR has proposed to enhance limit for taxation of salary class from Rs600,000 t0 Rs1200,000 by reducing the slabs from 12 to 7.
Chairman said that there will be no tax on income not exceed Rs600,000 whereas Rs100 tax where taxable income exceeds Rs600,000 but does not exceed Rs1200,000.
It has also proposed to impose 7% tax on the amount exceeding Rs1.2 million but does not exceeds Rs2.4 million, Rs84,000 plus 12.5% on the amount exceeding Rs2.4 million but does not exceed Rs3.6 million, Rs234000 plus 17.5% on amount exceeding Rs3.6 million but does not exceed Rs6 million, Rs654,000 plus 22.5% on the amount exceeding Rs6 million but does not exceed Rs12 million and Rs2,004,000 plus 32.5% on the amount exceeding Rs12 million.
Customs Revenue measures
Chairman FBR briefed the media that FBR has also proposed to impose 10% regulatory duty on import of Motor Spirit to address duty free import under China Pakistan Free Trade agreement (CPFTA). We have estimated to collect Rs30 billion revenue in next year, he added.
It has also been proposed to enhance Customs duty from 10 to 11percent and 2% additional Customs duty on import of Synthetic Filament Yarn, Monofilament and Staple Fibers of Polypropylene.
FBR has also proposed to withdraw RD exemption on import of high carbon wire rod as well as stamping foils and increase in RD rate on optical fiber cables from 10% to 20%.
Sales Tax
Member IR policy FBR informed that FBR has also proposed to impose 3% sales tax on compressor scrap, motor scrap and copper cutting scrap even if imported by manufacturers.
As per the Finance bill, a new levy up to Rs16,000 has been proposed on the import of mobile phone handsets. There will be a levy of Rs100 per set on a mobile phone with cost and freight (C&F) value of up to $30. The rate of levy per set on mobile phones having a C&F value between $30 and $100 will be 200. The rate of levy per set on mobile phones having a C&F value between $101 and $200 will be 600.
Similarly, the rate of levy per set on mobile phones having a C&F value between $201 and $350 will be 1800. The rate of levy per set on mobile phones having a C&F value between $351 and $500 will be 4000. The rate of levy per set on mobile phones having a C&F value between $501 and $700 will be 8000. The rate of levy per set on mobile phones having a C&F value of above $701 will be 16000.
On the other hand, it has also proposed to exempt all types of seeds, power generation projects, solar panels, tractors, local supply to charitable hospitals and imports by UN diplomats, privileged persons from sales taxes from next month.
Federal Excise Duty
He also said that FBR has also proposed to increase Federal Excise Duty (FED) from Rs5200 to Rs5600 on locally produced cigarettes if their on pack printed retail price exceeds Rs5960 per 1000 cigarettes.
Meanwhile, it has also proposed to increase FED from Rs1650 to Rs1850 on locally produced cigarettes if their on pack printed retail price exceeds Rs5960 per 1000 cigarettes.
In addition, FBR has also proposed to increase FED from Rs10,000 to Rs50,000 on club, business and first class travel by air.
Moreover, It has also been proposed to increase in rate of FED on Telecommunication Services from 16% to 19.5% which means phone calls would be expensive from next month.
Chairman FBR said that FBR will collect Rs6000 billion taxes in outgoing year and we set Rs7002 billion tax revenue target for next fiscal year.
