Government proposes Rs975bn tax relief package, seeks IMF clearance

Prime Minister Shehbaz Sharif on Tuesday gave instructions to take up the issue of reduction in some of the income taxes with the International Monetary Fund (IMF) after his income tax panel proposed a Rs975 billion relief package for corporate and salaried classes. The recommendations include reducing the tax burden on the salaried class by 25%, abolishing the income tax surcharge and withdrawing the wealth tax imposed in the shape of capital value tax on foreign assets. Out of the Rs975 billion proposed package, the immediate relief cost is estimated at over Rs600 billion, according to the tax reform proposals presented to PM Sharif by a private sector-led panel on income tax. However, due to the compulsions of the IMF programme, the government plans to implement only those proposals that will be endorsed by the IMF.