Govt plans 5% income tax cut for salaried class

ISLAMABAD: The government has come up with a plan to reduce income tax for salaried individuals by 5 percent to 30 percent.

According to details, Prime Minister Shehbaz Sharif has given in-principle approval to the proposal to abolish the super tax imposed on wealthy individuals and the corporate sector and reduce income tax on the salaried class by 5 percent, for which permission will be sought from the IMF.

Sources said that the meeting chaired by the Prime Minister reviewed the proposals to be presented to the IMF next week.

The government plans to reduce the maximum income tax rate for high-income salaried individuals by 5 percent to 30 percent and also increase the relevant income threshold (slab).

It was informed in the meeting that the government will also place a proposal to abolish the super tax imposed on wealthy individuals and companies before the IMF.

The Prime Minister directed that these proposals be further improved with private sector experts so that they can be presented to the IMF.

Sources say the government is considering a tax cut of around Rs 1.5 to 1.8 trillion, but it is likely that the IMF will find it difficult to provide such a large financial capacity.