ICCI calls for slashing tax on rental income

Islamabad: Muhammad Ahmed Waheed, President, Islamabad Chamber of Commerce and Industry (ICCI) has called upon the government to cut high taxes on rental income to 10 percent in the forthcoming budget that would facilitate the growth of business activities and improve tax revenue of the government as well. He said that up to 35 percent tax on rental income has increased rents of offices manifold due to which many companies were facing great problems. He said that due to the coronavirus issue and lockdown, many business companies were facing severe difficulties in paying their rents.

Muhammad Ahmed Waheed said that with the imposition of 35% tax on rental income, Islamabad has also become a very expensive city. Therefore, there was a need to reduce this tax appropriately, which would reduce the hardships of companies and the people. He demanded that government should review the tax on rental income tax in the next budget and bring it down to 10 percent final tax, which will significantly reduce rents, reduce problems of business community, improve business activities and enhance tax revenue of the government.

Mohammad Ahmad Waheed said that previous 10 percent uniform tax was levied rental income as final liability which was affordable for tenants and improved tax revenue of the government. But later on 8 slabs of this tax were introduced increasing maximum tax to 35 percent which not only increased the rent for companies unnecessarily and also increased the difficulties of the business class and encouraged tax evasion as well.

Therefore, he demanded that in the next budget, government should rationalize this tax by introducing a uniform tax of 10 percent on rental income as final liability, which would reduce rents, speed up business activities and increase tax revenue as more people will come into the tax net.