KARACHI: In the tax concessions announced in the financial year 2018-19, the government has provided monthly relief of Rs5,000 to Rs35,000, as there will be 5,000 rupees to 25,000 rupees less deductions from their salaries from July 2018.
Tax experts term it a big relief to the salaried class, while Karachi Tax Bar Association Vice President Zeeshan Merchant has said that in fact Rs5,000 have been added to the salaries of those getting Rs60,000 monthly salaries.
In the current budget, the government has defined 12 categories (slabs) for the salaried class, and fixed tax rate from 2% to 30%. In the last category, an employee getting more than Rs70 lakh per annum was bound to pay tax at the rate of 30% along with Rs1422,000 fixed amount.
In the upcoming financial year, those salaried persons with annual income of Rs400,000 have been exempted from tax. However, those getting Rs400,000 to Rs800,000 and Rs800,000 to Rs1200,000 have been imposed token tax. Therefore, those getting salary in the range of Rs40,000 to Rs100,000 monthly, will get financial relief of Rs5,000 to Rs9,000. Tax ratio of other three categories has also been cut by 50%.
The employees getting Rs12-24 lakh rupees will pay tax at the rate of 5%, those getting Rs24-48 lakh rupees annually will pay Rs60,000 fixed amount, and 10% tax for the amount over and above Rs24 lakh per annum.
For the last category, those drawing Rs48 lakh annual salary, would have to pay Rs300,000 fixed tax, plus 15% additional tax for over and above income of Rs48 lakh rupees. Experts say that non-salaried class has not been given any mentionable relief in the new budget. Similarly the government must pay attention to the plight of senior citizens.