KARACHI: The domestic consumers might face another financial burden in the shape of withholding tax on electricity charges of over Rs25,000/month, sources said on Thursday.
The Federal Board of Revenue (FBR) has proposed the government impose withholding tax on monthly bills exceeding Rs25,000 and made it a part of the Finance Bill, 2021, they added.
The revenue board is finalizing tax proposals for the Federal Budget 2021/22 that will be presented before the Federal Cabinet on June 10, 2021, for approval and subsequent presentation before the parliament on the same day.
At present, domestic electricity consumers are liable to pay the withholding tax at 7.5 percent on monthly bills above Rs75,000. However, this threshold has been proposed to be reduced to Rs25,000 at the same rate of 7.5 percent to broaden the tax base and improve compliance of returns filing.
The deduction of withholding tax under this head is adjustable against the total tax liability of a taxpayer.
The sources said the revenue board also recommended an amendment regarding income from the property. It is proposed to bring income from immovable property under the normal tax regime on an annual income above Rs10 million.
Similarly, amendments to capital gains tax on the sale of immovable properties have also been proposed. At present, the minimum amount of immovable property value is Rs5 million for the application of capital gains tax, which has been proposed to be reduced to Rs2 million.