ISLAMABAD: Just days before finalizing the Rs435 billion tax-heavy budget, the federal government has introduced an additional Rs36 billion mini-budget and eased restrictions on high-value purchases by individuals with low declared assets.
The revised conditions aim to address concerns regarding the previously proposed blanket bans on major economic transactions by ineligible taxpayers. The government has now allowed exceptions—for example, cars worth up to Rs7 million and properties below specific thresholds will not trigger ineligibility.
Combined, the main budget and mini-budget bring total new taxation measures to Rs462 billion. New levies include a controversial Rs10 federal excise duty on one-day-old chicks and increased tax rates on mutual fund dividends and profit from government securities. The move is aimed at offsetting the revenue loss from reducing the sales tax on solar panel imports from 18% to 10% and funding a 10% public sector salary hike.
The National Assembly Standing Committee on Finance, chaired by PPP’s Syed Naveed Qamar, endorsed these proposals. FBR Chairman Rashid Langrial noted that three of six new tax proposals have been accepted by the IMF. The committee also approved increased income tax on mutual fund earnings and raised the withholding tax on government securities’ profits to 20%.
Additionally, a uniform 10% sales tax on local and imported cotton has been introduced to resolve industry anomalies.
