KARACHI: The federal government has withdrawn the proposal to give concessions to salaried persons and retained the minimum threshold for salary income at Rs600,000.
Through the Finance Act, 2022 the new tax rates on salary income have been implemented from July 01, 2022.
The new tax rates are as follow:
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01. Where the taxable income does not exceed Rs 600,000: the tax rate shall be zero.
02. Where the taxable income exceeds Rs 600,000 but does not exceed Rs 1,200,000: the tax rate shall be 2.5 per cent of the amount exceeding Rs 600,000.
03. Where the taxable income exceeds Rs 1,200,000 but does not exceed Rs2,400,000: the tax amount shall be Rs 15,000 + 12.5 per cent of the amount exceeding Rs 1,200,000.
04. Where the taxable income exceeds Rs2,400,000 but does not exceed Rs 3,600,000: the tax amount shall be Rs 165,000 + 20 per cent of the amount exceeding Rs 2,400,000.
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05. Where the taxable income exceeds Rs 3,600,000 but does not exceed Rs 6,000,000: the tax amount shall be Rs 405,000 + 25 per cent of the amount exceeding Rs 3,600,000.
06. Where the taxable income exceeds Rs 6,000,000 but does not exceed Rs 12,000,000: the tax amount shall be Rs 1,005,000 + 32.5 per cent of the amount exceeding Rs 6,000,000.
07. Where the taxable income exceeds Rs 12,000,000: the tax amount shall be Rs 2,955,000 + 35 per cent of the amount exceeding Rs 12,000,000.
Earlier, through Finance Bill, 2022 following rates of tax proposed for salaried person:
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01. Where taxable income does not exceed Rs. 600,000: the tax rate was zero.
02. Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,000: the tax rate was Rs100
03. Where taxable income exceeds Rs. 1,200,000 but does not exceed Rs. 2,400,000: the tax rate was 7 per cent of the amount exceeding Rs. 1,200,000.
04. Where taxable income exceeds Rs. 2,400,000 but does not exceed Rs. 3,600,000: the tax amount was Rs. 84,000 + 12.5 per cent of the amount exceeding Rs. 2,400,000.
05. Where taxable income exceeds Rs. 3,600,000 but does not exceed Rs. 6,000,000: the tax amount was Rs. 234,000 + 17.5 per cent of the amount exceeding Rs. 3,600,000.
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06. Where taxable income exceeds Rs. 6,000,000 but does not exceed Rs. 12,000,000: the tax amount was Rs. 654,000 + 22.5 per cent of the amount exceeding Rs. 6,000,000.
07. Where taxable income exceeds Rs. 12,000,000: the tax amount was Rs. 2,004,000 + 32.5 per cent of the amount exceeding Rs. 12,000,000.
