A few months ago, the previous government announced new rates for income tax. The new rates were welcomed by the salaried class who got relief based on the newly announced tax slabs.
Furthermore, the government has made it tougher for non-filers to buy cars and properties, based on new regulations that are geared towards expanding the tax base of the country.
Non-Filers Face Restrictions
From today onwards, you will have to register as a tax filer if you wish to buy a car in your name.
To this end, Indus Motors and Pak Suzuki has already announced its intention to block all sales of its car models to non-filers. Other automakers are also mulling similar moves.
In addition to this, former Finance Minister Miftah Ismail mentioned that non-filers will only be able to purchase property up to Rs 5 million or higher, making it harder for them to buy affordably-priced real estate.
The New Tax Rates
Former Finance Minister Miftah Ismail announced through his Twitter handle that the revised tax rates will be effective from July 1, 2018.
Attention all employed people on a salary. From July 1, your taxes have gone down. People making up to 1 lakh per month will have zero tax, people making up to 2 lakh will have only 5% tax on the additional lakh, and people making up to 4 lakh a month will have only 10% tax —>
— Miftah Ismail (@MiftahIsmail) July 1, 2018
As per the announcement, these income tax rates will be levied effective from this month:
- Zero tax on people making up to Rs 1 lakh a month.
- Between Rs. 1.2 million and Rs. 2.4 million a year: 5%
- Between Rs. 2.4 million and Rs. 4.8 million a year: 10%
- Above Rs. 4.8 million a year: 15%
For more detailed coverage on the new and simplified income tax rates, check out this link.
With the new rules in place, perhaps its time to revisit ProPakistani’s guide to file your taxes in Pakistan.