PHC upholds tax collection from doctors

PESHAWAR: The Peshawar High Court (PHC) on Monday ruled that the collection of annual professional tax from government doctors was in accordance with the law and relevant tax rules.

The court issued a written verdict on the matter, authored by Justice Syed Arshad Ali.The petitioners had challenged the deduction of professional tax from their salaries, arguing that no proper mechanism for its collection was in place.

Their legal counsel had contested the validity of Section 10 of the Khyber Pakhtunkhwa Tax Rules, claiming that the tax was not on income but on the profession itself.However, the court’s decision stated that under Section 10 of the Khyber Pakhtunkhwa Tax Rules, professional tax was applicable to civil servants and employees of statutory bodies.

It said that the Finance Act 1990 provided a framework for tax deductions.The verdict clarified that specialist doctors fell into different categories under this taxation system, with annual deductions of Rs80,000, Rs.60,000, Rs40,000, and Rs30,000, depending on their classification.

It also emphasized that the professional tax was being levied under Rule 10 of the Khyber Pakhtunkhwa Professions, Trades, and Callings Tax Rules, 1991, which applied to both government and civil servants.

The ruling further noted that one of the petitioners was employed under the MTI Act as part of a statutory body, while the other two were civil servants. As a result, the tax was applicable to both categories under Rule 10, making the tax collection legally justified.