Highlights of Budget Speech

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ISLAMABAD, June 3 (APP): The Part II of the budget speech of Finance Minister Ishaq Dar on Friday covered the areas of income tax, sales tax and the relief measures for government employees and pensioners.
Following are the highlights:
“INCOME TAX”
RELIEF MEASURES:
• Corporate tax rate reduced at 31%
• Tax credit on stock exchange enlistment available for 01 year
• House building loan mark-up limit enhanced to Rs 2 mln
• Tax relief equal to 5% of school fee up to Rs 60,000 per child per anum, for parents with income less than Rs 1 mln -Employers’ annual contribution limit to Provident Funds enhanced to Rs 150,000

REVENUE MEASURES:
• Advance tax to be paid on ACT basis
• Minimum tax exemption to companies declaring gross loss withdrawn
• Tax rates of 18%, 16% and 11% for one, two and five years respectively introduced
• 10% capital gain tax on property sold within five years

EXEMPTION TO PRINT & ELECTRONIC MEDIA:
• Withholding tax increased to 1.5%
• Customs duty on import of newsprint from sales tax intact
• Exemption withdrawn on withholding tax on profit from Term
Finance Certificates
TAX RATE FOR NON-FILERS:
• Tax rate increased from 17.5% to 20%
• Withholding tax on electricity increased to 12%
• 3% withholding tax of the value of purchased vehicle at lease
• 20% withholding tax on winning prize bonds

TAXATION OF BUILDERS & LAND DEVELOPERS:
• Final tax scheme on the basis of fixed tax per area proposed
• Withholding tax on TV channels airing foreign produced content
• 20%tax at payment of foreign produced advertisement

“SALES TAX & FEDERAL EXCISE DUTY”
RELIEF MEASURES:
• Sales tax exempted on import of laptops, PCs
• Sales tax reduced to 8% on second-hand clothing
• 16% Federal Excise Duty withdrawn on advertisement on CCTV, shipping agents, Modarabas, Musharikas, stock brokers etc
• Sales tax on electricity consumption on marble cutting at Rs
1.25 per kilo watt hour
REVENUE MEASURES:
• Zero-rated status of stationery items abolished
• Zero-rated status of milk abolished

FEDERAL EXCISE DUTY ON CEMENT, PHONE, CIGARETTE:
• FDE fixed at one rupee per kg
• On mobile phones import, sales tax of Rs 1,000, Rs 1,500 and Rs 300 at medium, high and low category respectively
• FDE of 23 paisa and 55 paisa per cigarette on low and high tier respectively
• FDE on aerated water increased from 10.5% to 11.5%

CUSTOMS DUTY & TARIFF SLABS:
• Tariff slabs reduced from 5 to 4 wit new at 3%, 11%, 16% and
20%
• Custom duty on import of raw material for LED lights
• Custom duty on import of betal nuts, leaves increased to 20%

“PAY & ALLOWANCES FOR GOVT. EMPLOYEES, PENSIONERS, LABOURERS”
FEDERAL GOVT. EMPLOYEES:
• Adhoc increase of 2013 and 2014 merged in pay scales
• 10% Adhoc Relief Allowance on running basic
• Special Area Compensatory Allowance of Rs 300/month for civil armed forces posted in border areas
• Unattractive area/compensatory allowance for Chitral, Dir, Hazara Division, Swat and Malakand at par with rates of KPK government
• Special conveyance allowance to disabled employees of Rs 1,000/month (on proposal of Opposition Leader)
• Integrated Allowance for Qasid/Naib Qasid/Daftries from Rs
300 to Rs 450
• Revision of Outfit Allowance to Pak Army officers @ Rs 2,500 and from reversion to Army @ Rs 2,000
• 50% late-sitting conveyance charges for BPS 1-15
• Washing allowance @ Rs 100 and dress allowance @ Rs 100 increased to Rs 150 each for BPS 1-4
• M.Phil Allowance @ 25% of Ph.D Allowance, i.e. Rs 2,500/month to federal government employees on pattern of Punjab government
• Ceiling of additional charge/deputation allowance increased from Rs 6,000 to Rs 12,000
• Ceiling of Current Charge Special Pay revised from Rs 6,000 to Rs 12,000
• Increase in qualification pay @ 50% and inclusion of ACCA/CIMA qualification – CA/ICMA/ICWA/ACCA/CIMA/Staff College/NMC/NDC, NIPA Adv Course/Mid Career etc
• Upgradation of Lower Division Clerk (BS-7 to BS9), Upper Division Clerk (BS-9 to BS-11), Assistant (BS-14 to BS-16) and Assistant-in-Charge (BS-15 to BS-16)
• Upgradation of posts of Khateebs (BS-12 to BS-15), Moazzins/Muddaris (BS-5 to BS-7), Khadim (BS-5 to BS-6)
• Risk Allowance/Special Risk Allowance to Federal Levi Force in FATA, PATA (KPK) and Balochistan equal to one month initial basic pay of 2008 pay scale

PENSIONERS/FAMILIES:
• 10% increase in net pension
• 25% increase in net pension for pensioners aging 85 years and above
• Ex-gratia pension of former East Pakistan pensioners revised from Rs 2,000 to Rs 6,000 self-pension and from Rs 1,000 to Rs
4,500 family pension
• Upper limit of investment by pensioners, senior citizens and widows in Behbood Scheme of National Savings increased from Rs
4 million to Rs 5 million
LABOURER:
Minimum wage of a labourer up from Rs 13,000 to Rs 14,000