Pakistan: Direct and indirect tax measures in Finance Bill, 2024
The Finance Bill, 2024 was presented to the National Assembly.
The Finance Bill, 2024 was presented to the National Assembly.
The Finance Bill, 2024 was presented to the National Assembly. The proposed tax measures include:
Income tax
- Inclusion of a member of the Federal Board of Revenue (FBR) in the definition of "Board"
- Deduction of advance tax at the time of payment or registration of shares
- Carry forward of business losses for 10 years for Pakistan International Airlines Corporation Limited
- Tax credit for income derived from coal mining projects in Sindh
- Higher tax rates for persons not on the Active Taxpayers List (ATL)
- Penalties and prosecution for non-compliance, such as failure to file returns or discontinuing business without notification
- Significant increase in tax rates for both salaried and non-salaried individuals
- Enhanced tax rates on dividends from mutual funds and capital gains
Sales tax
- Introduction of specific instances that may constitute tax fraud
- Reinstatement of sales tax on advance payments
- Comprehensive framework for auditing sales tax affairs
- Implementation of an electronic invoicing (e-invoicing) system
- Changes in sales tax rates for various goods, including an increase for medicaments and certain categories of cellular phones
- Repeal of zero-rating for local supplies to registered exporters under the Export Facilitation Scheme
Federal excise duty (FED)
- New FED rates on various items including acetate tow, sugar, and nicotine pouches
- Increase in FED on cement and cigarettes
- FED on the transfer of property and certain high-value transactions
Customs
- Exemption of customs duties on specific items like bovine lipid extract surfactant
- Reduction and rationalization of customs duties on various imports including electric vehicles and parts of submersible pumps
- Establishment of new enforcement frameworks for customs regulations
Read a June 2024 report prepared by the KPMG member firm in Pakistan
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