Finance Act, 2021: FBR to boost revenue collection through various revenue measures

Finance Act, 2021: FBR to boost revenue collection through various revenue measures

ISLAMABAD: The Federal Board of Revenue (FBR) shall boost tax collection through various measures adopted through Finance Act, 2021.

The changes have been implemented from Thursday July 01, 2021 for the fiscal year 2021/2022.

The sources in the FBR said that the revenue measures are included a special regime for export of services at par with export of goods to be taxed at the rate of one per cent under final tax regime.

Through Finance Act, 2021, block taxation of property income has been eliminated and the same is shifted to normal tax regime.

The rate of capital gain tax has been enhanced on disposal of immovable properties.

Reduction in block taxation on interest income has been allowed, if it exceeds Rs5 million.

The interest income from federal government securities would be taxed under final tax regime at the rate of 15 per cent.

Tax on “on” money on vehicles has been continued for the fiscal year 2021/2022, if vehicle is disposed without registration.

The withholding tax scope has been expanded on supply chain below manufacturers and importers of specified sectors.

The reduced threshold monthly electricity bill for withholding tax on electricity consumption has been reduced from 75,000 to 25,000 from domestic users not appearing on Active Taxpayers’ list (ATL).

The tax authorities would not require issuing separate notice in concealment cases.

Scope of withholding agents has been broadened for the purpose of collection of withholding tax on commission income under section 233 of Income Tax Ordinance, 2001.

Withholding tax has been streamlined on sale and purchase of immoveable property under section 236C and 236K of the Ordinance.

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