ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has proposed a five percent reduction in withholding tax on the corporate sector.
As per the details of the tax proposals for the Budget 2024-25, the SECP has proposed a 5% reduction in the withholding tax on the corporate sector and has proposed to reduce the rate of withholding tax from 15% to 10%. has gone
However, sources say that the FBR has not favored the proposal to increase the tax on non-filers on cash withdrawals from banks for inclusion in the budget yet, it is being reviewed.
According to officials, the proposal is aimed at closing the tax gap between corporate and non-corporate businesses, raising the overall tax rate to 39.65 percent on profits of corporate companies, 29 percent income tax from corporate companies and another 15 percent tax on distribution of profits. is going. Tax rates on non-corporate companies or businesses range from zero to 35 percent.
According to the sources, eliminating the tax rate gap will help document the economy, it has also been proposed to charge non-bank financial companies at a lower rate for 5 years.
A lower tax rate will be given in the case of conversion from a non-profit organization to a for-profit company, charging only 5 percent tax for the first two years, and an annual increase of 5 percent tax for the next four years.
A proposal is under consideration to allow asset management companies to collect super tax, currently asset management companies are only allowed to collect capital gains tax.
On the other hand, according to FBR officials, the proposal to increase tax on cash withdrawals from banks for non-filers has not been finalized yet, for non-filers it was proposed to increase the tax to 0.9% on withdrawals of more than Rs 50,000.
Officials say that the Prime Minister has directed to reconsider the proposal to increase the tax on cash transactions, a plan was prepared to collect Rs 20 billion from non-filers and on non-filers withdrawing more than Rs 50,000 from banks. A 0.6% withholding tax is levied.
