KARACHI: The basic threshold of taxable salary is proposed to be enhanced to Rs1.2 million from the current Rs0.6 million for salaried individuals. This would pass tens of billions of rupees benefit to salaried people.
This will generate a positive economic cycle whereby this money would get transferred to the businesses as the disposable income of salaried people increases therefore ultimately, the government will benefit through the thriving of the business, the creation of more jobs, and tax revenues in the future.
According to Finance Bill 2022, there will be no tax where taxable income does not exceed Rs. 600,000.
Tax will be Rs100 where taxable income exceeds Rs. 600,000 but does not exceed Rs1,200,000.
Income tax will be 7% of the amount exceeding Rs. 1,200,000, where taxable income exceeds Rs 1,200,000 but does not exceed Rs 2,400,000.
Where taxable income exceeds Rs. 2,400,000 but does not exceed Rs. 3,600,000, income tax will be Rs84,000 + 12.5% of the amount exceeding Rs. 2,400,000.
Where taxable income exceeds Rs. 3,600,000 but does not exceed Rs. 6,000,000, the income tax will be Rs. 234,000 + 17.5% of the amount exceeding Rs. 3,600,000.
Where taxable income exceeds Rs. 6,000,000 but does not exceed Rs. 12,000,000; income tax will be Rs 654,000 + 22.5% of the amount exceeding Rs. 6,000,000
Where taxable income exceeds Rs. 12,000,000, income tax will be Rs. 2,004,000 + 32.5% of the amount exceeding Rs. 12,000,000.