ISLAMABAD: The Federal Board of Revenue (FBR) has briefed the Minister for Finance, Muhammad Aurangzeb, on a variety of tax proposals received from different stakeholders with regard to the upcoming budget.
The minister was briefed in the last 48 hours on a variety of tax proposals and shared the reasons for acceptance or rejection of the tax proposals going to be incorporated in the upcoming Finance Bill 2025-26.
The government has decided in principle to tighten its noose against potential tax dodgers with the possibility to incorporate all proposals which were introduced through in shape of Tax Laws Amendment Bill 2025 as part of the next Finance Bill 2025-26.
It has been proposed that the GST exemption on import of solar panels may be withdrawn but it is under consideration to impose reduced rate of GST. If the GST rate of 18 percent is slapped on imported panels, it will increase the price of solar panels in the domestic market. There are other products where there is reduced rate of GST, including fertilizer, pesticides and some other items.
On the income tax side, the government had proposed restrictions on property transactions beyond Rs10 million as the eligible person was supposed to declare assets in the filed returns of the last five years. It was decided that Income Tax Law under section 114C, in clause (1) (b), the word “Board” be replaced with the word “Federal Government”. The federal government will determine the value threshold for transactions affected by this restriction to ensure that property transactions conducted by common citizens and the lower- and middle-income class, particularly first-time property buyers or those purchasing their primary residential property, are not impacted.
For declaring ineligible, the “sufficient resources” shall mean one hundred and thirty percent of the cash and equivalent assets comprising cash denominated in local or foreign currency, fair market value of gold, net realisable value of stocks, bonds, receivables or any other cash equivalent asset as may be prescribed, declared by a person either in his sources of investment and expenditure statement, or wealth statement filed for the latest tax year and in the case of a company or association of persons, cash and equivalent assets, declared in the financial statements attached with the income tax return for the latest tax year: Provided that where an asset mentioned in sub-section (1), other than its clause (d), has been purchased by way of exchange of capital assets already declared in the wealth statement, or financial statement, or sources of investment and expenditure statement, the disposal of such capital assets shall be treated to be part of cash equivalent assets to the extent of value mentioned in the agreement.”
