The Federal Board of Revenue (FBR) has told tax officials to stop issuing advance income tax notices to salaried people whose only source of income is their salary, according to sources. The directive came from FBR Chairman Rashid Mahmood Langrial.
The move is meant to lighten the tax burden on salaried taxpayers, who have been receiving notices across the country asking them to deposit advance income tax every quarter, the sources said.
How the new directive affects salaried taxpayers
Under the instructions, notices should not be sent to individuals who rely solely on their salaries for their livelihood. Salaried people who earn income from other sources, however, may still be asked to pay adjustable advance income tax, subject to the applicable rules.
The sources added that advance tax collected from eligible taxpayers would be adjusted against their tax liability under the relevant provisions. The step comes amid growing concern over the tax burden on salaried individuals and calls for a fairer distribution of taxes among different income groups.
Asad Umar questions tax burden and petroleum levy
Earlier, former finance minister Asad Umar criticised the government’s economic policies. He claimed that salaried people paid more than Rs600 billion in taxes last year, while landlords contributed less than Rs10 billion.
In a television interview, Umar said economic growth had remained weak while inflation and poverty had increased. He said Pakistan had experienced record-high inflation and that government figures indicated a rise in the number of people living below the poverty line.
On petroleum, Umar argued that the government should have reduced the petroleum levy when international oil prices rose by 60 to 70 per cent, instead of raising taxes on fuel alongside prices. He alleged that the levy on petrol had risen from Rs50 to Rs117 per litre, and that the government had collected about Rs1.6 trillion through the levy in the previous year.
Umar further claimed that more than Rs600 billion had been collected in taxes from salaried individuals, compared with less than Rs10 billion from landlords, feudal families, industrialists and wealthy landowners across the four provinces.
