His name has become synonyms with more DO MORE by IMF. Finance Minister Miftah Ismail on Friday announced a new fixed tax scheme on shops outside of the tax net to reduce the budget deficit and elaborated on the “super tax” on 13 large industries announced by the prime minister that rattled the stock market.
Addressing a National Assembly session convened to wind up the budget debate, Ismail said the country was no longer on the way to default as it was on the path to progress. He had presented the budget for the fiscal year 2022-23 with an outlay of Rs 9.5 trillion on June 10.
As debate on the budget commenced in the NA today, Ismail said most of the recommendations made by lawmakers in the Senate and NA during preceding sittings had been incorporated into the budget.
Taxes
During his address, he referred to the taxes announced by Prime Minister Shehbaz Sharif earlier in the day, Ismail told the House that no indirect taxes had been imposed and neither had any tax been imposed on consumption.
“We have taxed the rich. Much of the revenue will be collected through that so that we don’t have to ask for money from others and are able to reduce our budget deficit,” he said.
Then, on a lighter note, he sought credit for imposing taxes on companies owned by Prime Minister Shehbaz Sharif’s son.
“And my companies will also pay Rs200m more in taxes than before and so if we are asking others to pay more taxes, we, too, are contributing to this [cause],” the finance minister said.
He said the government had committed to the IMF that the primary deficit of Rs1,600bn recorded this year would not only be brought down but there would be a surplus of Rs153bn.
To achieve this, as well as self-reliance, an additional tax of 1pc would be imposed on individuals and entities whose annual income exceeded Rs150m on account of poverty alleviation. Similarly, he added, those with an annual income of over Rs200m would be subject to an additional tax of 2pc, those earning more than Rs250m to 3pc and those having an annual income of more than Rs300m would be taxed 4pc of their income.
“This is a one-time tax for the fiscal year 2022 (on income earned in that year),” he added. Moreover, the minister said, the government had identified 13 sectors that had earned significant profits this year.
“And we have decided that companies that have an income of more than Rs300m, will be subject to a super tax of 10pc for a year,” he announced.
The minister said companies working in cement, steel, sugar, oil and gas, fertiliser, LNG terminals, textile, banking, automobile assembling, cigarettes, beverages, chemicals and airline sectors would have to pay this tax.
