Islamabad: The Federal Board of Revenue (FBR) has finalised proposals for new taxation measures worth PKR 300 billion to bridge the income shortfall incurred in the tax year (TY) 2022-23, the news sources reported on February 10.
The FBR Tax Laws Amendments Ordinance, 2023, which will be presented before the federal cabinet for final approval will include tax measures including a 1% increase in the standard rate of sales tax from 17% to 18% and changes in the withholding tax regime to stopgap the shortfall. The new tax ordinance, if approved, is estimated to generate a total revenue of approximately PKR 355 billion. Some of the proposals include increasing the standard rate of sales tax on petroleum products, raising the rates of withholding taxes, imposing a tax on sugary drinks, and imposing a tax on banks’ foreign exchange income. Other proposals include a tax on banking transactions of non-filers, a flood levy, increased capital value tax rates on imported and locally-assembled vehicles, and an increase in the rate of advance tax on the purchase/sale of immovable property.
It is important to mention that the government has set a tax target of PKR 7.4 trillion for the current fiscal year. However, the FBR fell short of the total revenue collection predictions in the second quarter of the current fiscal year.
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