ISLAMABAD: The Federal Board of Revenue (FBR) has drafted proposals of new taxation measures of nearly Rs300 billion to be enforced through the promulgation of the Tax Laws Amendments Ordinance, 2023.
Sources told Business Recorder on Wednesday that the Ordinance is expected to be promulgated during the next 7-10 days. Initially, the revenue impact has been worked out at Rs200 billion, which has been raised to Rs300 billion. The revenue impact of the proposed withholding tax on banking transactions of non-filers is nearly Rs45 billion.
The three percent flood levy could generate additional revenue of Rs60 billion. The proposed increase in the rates of capital value tax rates on imported and locally-assembled vehicles has been estimated to generate an additional revenue of Rs10 billion. The proposal to impose tax on banks’ foreign exchange income has been estimated to generate Rs20 billion. The proposal to raise the Federal Excise Duty (FED) on sugary drinks would generate Rs60 billion. The proposed impact of further raise in the FED on cigarettes has been estimated at Rs25-30 billion. The proposed increase in the rate of advance tax on the purchase/sale of the immoveable property would generate about Rs20-30 billion. The proposed withdrawal of sales tax exemption on the import of raw materials/inputs used in the manufacturing of export goods under the “export facilitation scheme” has a revenue impact of Rs20-25 billion. The said proposals are under discussion between the FBR and the Ministry of Finance but have yet not been finalised. After approval of the proposals, the Presidential Ordinance would be promulgated, sources added.
The government under the contingency revenue measures agreed with the International Monetary Fund (IMF) to increase FED on sugary drinks/cigarettes and withdrawal of sales tax exemption to the exporters if a month’s revenue collection data underperformed.