Federal Government withdraws income tax exemptions worth Rs 140 billion

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Federal Government withdraws income tax exemptions worth Rs 140 billion

ISLAMABAD – The federal government has decided to withdraw income tax exemptions of Rs 140 billion given to various sectors.

According to the sources, the federal cabinet has given approval to withdrawal of various income tax exemptions through a presidential ordinance instead of bringing in a bill in the National Assembly. It added that the income tax exemptions will be withdrawn with immediate effect.

The cabinet approved withdrawing income tax exemptions to the tune of Rs140 billion to fullfil the International Monetary Fund’s (IMF) condition to pave the way for release of the third tranche of $500 million.

The cabinet gave the approval through circulation of a summary which said that the bill couldn’t be presented in the Parliament for want of time. The members of the cabinet would record their opinion for promulgating Tax Laws (Second Amendment) Ordinance 2021’ within 24 hours.

It is noteworthy here that the IMF board is likely to make a decision on the release of the third tranche on March 24. It had set various conditions for the government to meet to unlock the third tranche related to $6 billion extended fund facility.