Pakistan May Impose Taxes on People With Monthly Income of Rs 50,000 or Below

In a bid to increase tax revenue, Government of Pakistan is mulling to lower the tax-free income threshold that is going to impose taxes on individuals with a monthly income of Rs. 50,000 or below, which will help to increase revenue collection.

The Government plans to simplify the structure of personal income tax as well, which will help make the system more accessible and transparent, while encouraging compliance and fair tax contributions.

Furthermore, there are plans to implement a more progressive taxation policy, which is going to put more burden on individuals earning over Rs. 0.5 million per month. According to the details, these individuals may be subjected to at least 35% tax rate on their income.

There are also plans to broaden the tax base by bringing small shopkeepers into the tax net and contribute their share towards the country’s economy.

These recommendations came from the World Bank, which believes that Pakistan isn’t taxing people enough. It also recommends imposing more taxes on owners of agricultural land exceeding 12 acres.

According to the World Bank, these measures will help to redistribute wealth and promote equity in Pakistan’s tax.

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