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June 27, 2019

Punjab Assembly passes budget, approves finance bill 2019-20

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June 27, 2019

LAHORE: The Punjab Assembly on Wednesday passed the provincial budget for the next fiscal year by approving the finance bill 2019-20 without any notable resistance from the opposition whose majority remained away from the House most of the time.

The brisk session which lasted less than 40 minutes was chaired by Speaker Ch Parvez Elahi while Chief Minister Sardar Usman Khan Buzdar remained in the House till the end. Opposition Leader Hamza Shahbaz stayed in his chamber and noted opposition members also remained away, thinning the strength of the opposition legislators in the House.

The Finance Bill 2019-20 included five new services in the ambit of the Punjab Revenue Authority by levying sales tax on them ranging from 5-16 per cent whereas the government withdrew sales tax earlier proposed on intercity air conditioned passenger busses at the rate of 16 per cent. The new services included in the ambit of Punjab Revenue Authority imposing 16 per cent tax on dress designing and stitching, renting bulldozers and heavy building machinery equipment including containers, generators and refrigerators, leather textile sector, cloth treating, embroidery, knitting, leather staining, colour separation and shrinking services. The registration fee on imported vehicles was raised to equalize the rate of Islamabad and other provinces. Hajj, Umrah, international and local air travels, excluding diplomats would be levied 5 per cent tax without subjected to input adjustment.

Apart from increasing the rate of a number of existing taxes, including stamp duty, new taxes have been levied on businesses and professions previously not falling into the tax net including all stock brokers, money changers, doctors, Hakeems, homoeopaths, contractors, builders and property dealers. The companies with up to Rs 5 million liquidity have to pay Rs 10,000 annual tax, that of up to Rs 50 million Rs 30,000, up to Rs 100 million Rs 70,000 and that of more than Rs 100 million Rs 1,00,000.

An annual tax of Rs 1,500 has been levied on factories with workforce of up to 10 persons, Rs 5,000 on those employing 25 and Rs 7,500 on those employing more than 25 persons. The government has also levied Rs 1,000 tax on lawyers, Rs 2,000 on jewellers and cable operators, Rs 4,000 on health clubs/gymnasiums in metropolitan limits and cigarette/tobacco dealers, Rs 6,000 on audit firms, taxation consultants, architects, money changers, engineering and scientific consultants, Rs 6,000-10,000 on motorcycle/scooter dealers, Rs 10,000 on stock exchange members, Rs 10,000 on motor car dealers and real estate agents in small cities and Rs20,000 on those working in metropolitan corporation limits.

The government also imposed Rs 20,000 tax on recruiting agents, Rs 1,000 on contractors/builders with business volume of up to Rs 1 million and Rs 6,000 on those exceeding the said volume. It imposed Rs 5,000 tax on medical consultants/specialists and dental surgeons, Rs 4,000 on registered medical practitioners and Rs 4,000 on homoeopaths and Hakeems.

Tax has been imposed on high value properties along highways and motorways. The registration fee for imported vehicles has been increased and brought on a par with that being charged in Islamabad and other provinces. Those travelling on domestic and international flights will have to pay 5 per cent tax which will not be adjusted as input tax. The government has doubled agriculture tax. However, holders of up to 12.5 acre land had been given tax exemption. Holders of up to 25 acre land will have to pay Rs 300, up to 50 acre Rs 400 and those holding more than 50 acre land will have to pay Rs 500 agriculture tax.

Property tax relief has been given for divorcee women and single female orphans in line with relief already being provided to widows.

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