The Finance Bill 2024 enacts specific provisions proposed in the 2024-25 Budget on 12 June 2024, which include amendments to personal income tax, capital gain tax, sales tax, excise duty, and other taxes. These changes will take effect on 1 July, 2024.
One of the key changes include how the business income of a non-resident in Pakistan is defined. Under the Act, this type of income will be considered Pakistan-source income if it is directly or indirectly attributable to “any business connection” in Pakistan.
A 10% surcharge will be levied on individuals and associations of persons with income exceeding PKR 10 million.
A capital gains tax of 15% on security redemptions will be deducted for stock funds if the fund’s dividend receipts are less than the capital gains.
A new tax ranging from 15% to 20% will be imposed on the gross receipts of contractors and developers engaged in the construction, development, and sale of residential, commercial, or other properties.
A tax rate of 12% has been imposed on the Fair market value of immovable property if the fair market value does not exceed PKR 50 million; a tax rate of 16% if the fair market value exceeds PKR 50 million but does not exceed PKR 100 million, and a tax rate of 20% if the fair market value exceeds PKR 100 million.
Pakistan’s National Assembly passed the Finance Bill 2024 on 28 June 2024. The bill received the President’s Assent on 29 June, 2024, before being published in the Official Gazette on the same day.
