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PESHAWAR, Jan 27 (APP):The Khyber Pakhtunkhwa Assembly on Monday passed the “Agricultural Income Tax Bill 2025,” introducing agricultural income tax across the province despite resistant by the opposition benches.
The bill, presented by Provincial Revenue Minister Nazir Abbasi, sets a framework for taxing annual agricultural income based on income slabs.
Under the new law, individuals earning between 6 lakh and 1.2 million rupees annually from agriculture would be taxed at 15 percent.
Those earning between 1.2 million and 1.6 million rupees annually would face a 20 percent tax, while incomes between 1.6 million and 3.2 million rupees would be taxed at 30 percent.
For agricultural incomes ranging from 3.2 million to 5.6 million rupees annually, a tax rate of 40 percent would be applied, while incomes above 5.6 million rupees would be taxed at 45 percent.
Furthermore, a super tax would be levied on individuals with agricultural incomes exceeding 15 crore rupees annually.
The bill also required landowners who possess properties in multiple patwar circles to submit detailed location information.
Returns on total agricultural income would also be mandatory. The legislation proposes that taxes would also be applied to 50 acres of cultivated land or over 100 acres of uncultivated land.
In the case of a company’s dissolution or the death of an individual, the responsibility for paying pending agricultural taxes and dues would fall on the heirs.
To ensure smooth implementation, the Revenue Board would establish zones at the district and tehsil levels for tax collection.
Individuals failing to pay agricultural income tax without valid reasons would face a daily penalty of 0.1 percent, as per the bill.
The law divided agricultural land into four zones, with varying tax rates. In Zone One, landowners with 12.5 to 25 acres of land would pay 1,200 rupees per acre in taxes.
Zone two would have a tax rate of 900 rupees per acre, Zone Three would charge 500 rupees per acre, and Zone Four, for land between 12.5 and 25 acres, would impose a tax of 300 rupees per acre. No tax would be applied on land below 12.5 acres in Zone Four.
The new legislation also extends the tax framework to corporate farming. Small companies would pay 20 percent tax on annual agricultural income, while large companies would be taxed at 29 percent.
During the session, Ahmed Karim Kundi, the parliamentary leader of the Pakistan People’s Party, criticized the bill, claiming it would overburden small farmers.
He argued that the government should exempt landowners with less than 25 acres and accused the administration of unfairly targeting farmers, many of whom are already struggling due to floods and exploitation by middlemen.
Kundi highlighted discrepancies in the tax calculations, noting that landowners earning 15 crore rupees annually would pay 6.66 crore rupees in taxes, while those with incomes between 15 and 20 crore rupees would pay only 1.5 million rupees.
He accused the government of facilitating money laundering through the bill and vowed to launch a campaign against what he described as unjust measures.
Despite objections, the assembly approved the bill.