The government is seriously thinking to increase the income tax threshold of Rs 300,000 to Rs 350,000 for salaried individuals in the upcoming budget 2011-2012, it has been learnt.
‘The Federal Board of Revenue and Revenue Advisory Council the other day agreed to increase the income tax threshold of Rs 300,000 to Rs 350,000 for salaried individuals in the upcoming budget 2011-2012’, said an officer of the FBR. However, he made it clear that it was not finalised yet.
He was of the view that the government would also expedite the processing of issuing notices of the non-taxpayers in the coming financial year.
The Income Tax Department has already identified 700,000 people who have assets but do not contribute a single penny to the kitty and government is expecting to recover billions of rupees from these non-filers in the coming financial year.
The government is trying to explore all possible ways to generate additional revenue for the coming year in order to make the expected annual tax collection target of above Rs 1900 billion a realistic one.
The government has already agreed with IMF that would eliminate the existing tax exemptions given to several sectors and commodities and would bring all these commodities under the General Sales Tax (GST).
However, basic food items and life savings drugs would be excluded from it. Sources told that the government is also considering imposing GST on poultry feed.
The government is facing criticism from the economists that it had fixed an unrealistic revenue collection target for the upcoming fiscal year.
They are of the view that the government has made Rs 1588 billion a base for above Rs 1900 billion target for the next financial year, however, the government could reach the target of Rs 1588 billion in the ongoing fiscal year.