Super Tax questionable, must be reconsidered, SC told

ISLAMABAD: The Supreme Court has adjourned until today (Tuesday) the hearing in the case against Section 4B of the Income Tax Ordinance, 2001, which pertains to the imposition of the super tax.

A five-member Constitutional Bench, headed by Justice Aminuddin Khan, heard the case. Other members of the bench were Justice Jamal Khan Mandokhail, Justice Muhammad Ali Mazhar, Justice Syed Hasan Azhar Rizvi and Justice Shahid Bilal Hassan.

Arguing before the court, Imtiaz Rashid Sheikh, counsel for the petitioner companies, contended that the imposition of a super tax in a country like Pakistan is questionable and must be reconsidered.

He submitted that the Lahore High Court’s single and division benches have given relief to the business community. He further stated that the Constitution exists in Pakistan and it provides relief to his clients. He informed the court that since July 1, 2022, his clients have been bound to pay a tax that they had already paid in the previous year.

Justice Mazhar inquired whether all cases from 2023, including those from Sindh and other provinces, were filed in the Islamabad High Court. Responding to this, Shehzad Atta, another counsel for the petitioner companies, submitted that on June 10, 2022, only banks were included in the bill, but by June 24, names of 13 more sectors had surfaced.

He submitted that on June 24, 2022, the federal minister for finance announced in his budget speech that 13 additional industries had been identified, and a 10 percent super tax would be imposed. He said that the minister stated that companies earning over Rs300 million would be subject to this 10 percent super tax.

At this point, Justice Mandokhail remarked, “I actually feel sorry for the then federal minister.” The counsel submitted that the FBR is providing data for 116 companies, which were included in the list by the State Bank of Pakistan. He mentioned having seen a list of 500 companies in Aptma (All Pakistan Textile Mills Association), while the government only has data on about 20 percent of companies. He added that the companies for which the government does have data are those that publish their data every three months. Later, the court adjourned the hearing until today (Tuesday).