FBR seeks proposals to eliminate exemption, concessions in income tax

FBR seeks proposals to eliminate exemption, concessions in income tax

ISLAMABAD: The Federal Board of Revenue (FBR) has called for proposals to eliminate exemptions and concessions under income tax laws as part of the formulation process for the budget 2023-2024.

In an official announcement on Monday, the FBR urged stakeholders, including businesses, tax experts, and trade associations, to provide input focusing on phasing out exemptions and concessions, along with suggestions for addressing distortions and anomalies in tax laws.

The initiative is part of the FBR’s ongoing efforts to enhance tax policy, foster equity in taxation, and broaden the tax base for more comprehensive revenue generation. The revenue body is actively engaged in formulating proposals for the Finance Bill 2023, and it seeks to benefit from the collective wisdom of all stakeholders to improve tax policy for the upcoming fiscal year.

The FBR outlined specific areas where input and suggestions are highly appreciated, including:

1. Broadening of tax base for wider participation in revenue generation efforts.

2. Taxation of real income on a progressive basis.

3. Phasing out of tax concessions and exemptions.

4. Removal of tax distortions and anomalies.

5. Facilitation of taxpayers and ease of doing business.

6. Promoting equity in taxation by introducing measures where the incidence of tax is higher on affluent classes.

Stakeholders are encouraged to share their valuable suggestions and proposals with the FBR, addressing the aforementioned policy areas. The focus on phasing out tax concessions and exemptions indicates a strategic move by the government to rationalize the tax system, ensure fairness, and eliminate loopholes that may have been exploited.

The call for suggestions aligns with the broader objectives of creating a more transparent, equitable, and efficient tax regime. By actively involving stakeholders in the policymaking process, the FBR aims to gather diverse perspectives and insights that will contribute to the development of well-informed and balanced tax policies.

The deadline for stakeholders to submit their proposals is set for February 27, 2023. This timeline emphasizes the urgency of the matter as the FBR works towards finalizing the proposals for the upcoming budget. The consultation process demonstrates the government’s commitment to inclusivity and responsiveness, ensuring that the tax policies introduced align with the needs and expectations of various sectors of the economy.

As stakeholders prepare to submit their suggestions, the FBR anticipates a robust and comprehensive exchange of ideas that will contribute to the creation of a more effective and equitable income tax system in Pakistan. The collaborative approach between the government and stakeholders reflects a commitment to continuous improvement and responsiveness in shaping the nation’s fiscal policies.