Finance Minister Miftah Ismail has proposed to increase the current tax rate on the banking companies from 39 percent to 42 percent to achieve the real tax potential.
The proposal has been made considering that the banking sector has generated extraordinary returns due to high-interest rates and safe investments in public securities.
Previously, the income tax rate for the banking sector was 35 percent with a 4 percent super tax. The new budget has announced a 3 percent increment, taking it to 42 percent.
While addressing the National Assembly (NA), Miftah also proposed shifting the tax burden from the poor to the rich. He said that given the dire economic straits, the important requirement of the time is that the wealthy class should go ahead and fulfill its important national responsibility by paying the full share of its share according to its resources and income.
The time has come to shift the tax burden from the poor to the rich, and it is proposed that all individuals, including companies and AOPS whose annual income is 300 million, should pay 2 percent tax, he added.
It is to be noted that the budget for the fiscal year 2022-23 has been finalized and tabled in the NA for approval.