WEB DESK: The Federal Board of Revenue (FBR), Pakistan’s principal tax authority, has proposed a significant increase in withholding tax for vehicles boasting an engine capacity of 850cc or higher. This move, if implemented, is poised to further burden prospective car buyers financially.
Furthermore, the government is contemplating augmenting the advance tax on cash withdrawals from banks for non-filers. Unofficial sources intimate that this tax could escalate from the current 0.6 percent to 0.9 percent, with estimates suggesting an additional revenue influx of Rs15 billion from non-filers alone, should the proposal materialize.
This endeavor to bolster tax revenues has not transpired in isolation. Pakistan’s administration has engaged in consultations with the International Monetary Fund (IMF), seeking fiscal adjustments as part of a broader bailout package.
Read more: IMF recommends Pakistan to increase GST to 18 pc
The impending federal budget for the fiscal year 2024-25, scheduled for presentation on June 7, is anticipated to outline a total expenditure of Rs16,700 billion. Within this framework, allocations of Rs9,700 billion are earmarked for interest and loan repayments, while grants are poised to reach Rs1,500 billion.
In terms of revenue generation, tax receipts are forecasted to surpass Rs11,000 billion. Direct taxes are anticipated to contribute Rs5,300 billion, with federal excise duty yielding Rs680 billion. Sales tax is expected to amass over Rs3,850 billion, while customs duty is projected to bring in more than Rs1,100 billion.
As Pakistan awaits the unveiling of its fiscal blueprint, the specter of higher car prices looms large, underscoring the challenges facing both the economy and its citizens in the days ahead.
