IMF Asks FBR to Increase Tax Burden on Salaried People

Federal Board of Revenue (FBR) Chairman Asim Ahmad Tuesday admitted that the International Monetary Fund (IMF) has rejected the Rs. 47 billion tax relief provided to the salaried class through the Finance Bill 2022.

Talking to the media at the Parliament House, Ahmad said that the FBR will now propose changes in the tax slabs as the government has no option but to accept the IMF’s demand. He stated that the FBR is drafting different models of tax slabs for salaried individuals to reduce the tax relief of Rs. 47 billion announced in the budget.

The FBR Chairman said that there is a disagreement between the IMF and the government on the personal income tax rates. The existing proposal is not acceptable to the IMF. He said the government does not want to burden the low-income earners. However, if we do not increase the taxes on low-income earners our revenue impact would not turn positive, he added.

He said that the government has to give tax relief to the low-salaried class as the cost of living is very high due to inflation. We have to give relief to the low-salaried employees at any cost, he said.

The government had proposed exempting those earning up to Rs. 100,000 per month from paying income tax in the budget for the fiscal year 2022-23 from the previous limit of Rs. 50,000 per month. Moreover, the 12 slabs were also reduced to seven.

The FBR Chairman added most of the people fall within the category of salary up to Rs. 200,000 per month. The total number of taxpayers in high slabs is so less than doubling the tax rates would not have any significant revenue impact on the salaried class.

“We cannot impose ridiculously high tax rates like 75 percent instead of 35 percent on high-income earners whereas the base of the lower-income earner is very wide, having an impact on revenue collection”, he said.


  • I’m gonna have a mini heart attack if they raise my income taxes any more. For God’s sake…


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