LAHORE — The Punjab Assembly has declared recent government notifications revising agricultural income tax rates unlawful, ordering an immediate suspension of their enforcement, assessments and collections.
Speaker Malik Muhammad Ahmad Khan issued the ruling during the Assembly’s 41st session while hearing a privilege motion moved by lawmaker Zulfiqar Ali Shah.
The Speaker said the notifications lacked legal validity as they were not presented before the Assembly in line with statutory requirements. He directed the Excise and Taxation Department to halt implementation of the revised rates and instructed the provincial government to place the notifications before the House within 15 days, along with a detailed explanation for the procedural lapse.
The matter has also been referred to the Assembly’s Committee on Law Reforms and Delegated Legislation, which has been tasked with fixing responsibility and submitting its findings within one month.
The dispute relates to notifications issued on March 5, 2025, revising agricultural income tax rates, followed by another notification on September 10, 2025, seeking retrospective application from July 1, 2025.
The mover of the motion argued that the notifications were not laid before the Assembly during the 2025–26 budget session, as required under Section 11(2) of the Punjab Agricultural Income Tax Act, 1997.
In his ruling, the Speaker emphasised that taxation powers rest with the legislature under the Constitution and that any delegated authority must strictly adhere to legal procedures. He said failure to present such notifications before the Assembly renders them ineffective and without lawful basis.
The Speaker termed the omission a breach of parliamentary privilege and underscored the importance of legislative oversight in fiscal matters. He also directed that all future changes to agricultural income tax rates be introduced during the annual budget session.
The ruling added that affected taxpayers may seek legal remedies regarding recoveries made under the now-void notifications.