KARACHI: The government has decided to continue the super tax levied for another year, it was imposed in 2015-16 for the purpose of rehabilitating temporary displaced persons (TDP) affected by the Army’s operation against terrorists and anti-social elements.
According to Finance Bill for the financial year 2017-18, Super Tax is levied at the rate of 4% on the income of Banking Companies and at the rate of 3% for other persons.
The circumstances which necessitated introduction of Super Tax are still continuing, therefore, it is proposed to extend the levy of Super Tax by one more year, i.e. for the tax year 2017-18.
Super Tax was introduced in the budget for financial year 2015-16. Since then, it continued to hurt the earning of the banking companies, however during last one and half years — when the lower policy rates squeezed interest income of the banks — the tax has taken toll to the profitability of the banks.
According to an estimate, the government would earn nearly Rs 25 billion extra from the Super Tax on the banking companies.