KARACHI: The tall claims of the government of pro-poor budget exposed as it witdrew the income support levy on the pressure of rich class of the country as they had to contribute some towards this fund.
“It drew the ire of the rich and wealthy individuals and it seems that the government had to finally budge in against the popular demand of the people who matter,” said a budget brief released by M. Yousuf Adil Saleem & Company, Chartered Accountants, member of Deloitte Touche Tohmatsu Limited.
Through the Finance Act 2013 a new levy on the net movable wealth of the persons was introduced through promulgation of Income Support Levy, 2013 (hereafter referred as “the Act”).
The Act had been promulgated with the objective to generate financial resources for providing support for economically distressed family of the country.
The Act provided for levying 0.5 percent of the net moveable wealth exceeding Rs 1 million as declared in wealth statement by the person.
The Income Support Levy was made effective retroactive from tax year 2013 and was required to be paid along with wealth statement. Thus, individual filing return of income for tax year 2013 was also be liable to pay this levy.
This levy was challenged by a number of taxpayers in the court on the plea that it is discriminatory since it is being collected only form individual taxpayers. Sindh High Court suspended the application of this Act. Later, the Supreme Court of Pakistan annulled the suspension order of the Sindh High Court.
The Bill seeks to repeal the Income Support Levy Act, 2013. As a consequence, the applicability of the Act in respect of tax years 2014-2015 need to be seen as this may create litigation.