The Supreme Court has ordered taxpayers/respondents to pay 50% of their due responsibility through “super tax” while reversing the Lahore High Court interim ruling.
The Federal Board of Revenue’s (FBR) case challenging the LHC interim order was considered by a division bench of the supreme court, which was made up of Chief Justice of Pakistan Umar Ata Bandial and Justice Athar Minallah.
In an effort to boost income in the face of rising inflation, Prime Minister Shehbaz Sharif slapped a 10% super tax on large-scale enterprises the previous year.
In the meantime, Hafiz Ahsaan Ahmad Khokhar, who was arguing the FBR cases before the higher courts, explained that through the Finance Act 2022-2023, parliament had added Section 4C to the Income Tax Ordinance 2001, and the government had hoped to raise between Rs215 billion and Rs247 billion under the head at the time the budget was passed.
According to the terms of Section 4C of the Ordinance, a super tax would be applied to every person’s income that exceeds Rs150 million beginning in the tax year 2022 at the rates listed in Division IIB of Part I of the First Schedule.
The senior tax advocate claims that the rate of super tax under this section for the tax year 2022 will be 10% rather than 4%, where the income of the persons engaged, partially or entirely, in the business of airlines, automobiles, beverages, cement, chemicals, cigarette and tobacco, fertilizer, iron and steel, LNG terminal, oil.
According to the tax attorney, if the income for the year exceeds Rs300 million, there will be a 10% super tax on banking companies’ income starting in the tax year 2023.