Pakistan: Tax provisions in budget 2017

Pakistan: Tax provisions in budget 2017

The budget, having been presented in Pakistan on the evening of 26 May 2017, sets the stage for the Finance Bill and for income tax, sales tax, excise tax, and customs law amendments.

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The measures generally have an effective date of 1 July 2017.

 

Among the income tax proposals are measures that would:

  • Extend the "super tax" for another year, for tax year 2017
  • Exclude "durable goods" from "consumer goods" having the effect that the reduced rate of minimum tax would no longer apply
  • Provide an exemption from tax for a three-year period for certain start-ups providing technology-driven products
  • Impose a 10% tax on undistributed profits of companies not distributing 40% or more of after-tax profits
  • Repeal the fixed tax regime for property developers
  • Increase the threshold for interest-free loans from employers
  • Limit the sales promotion, advertising, and publicity expenses of pharmaceutical manufacturers
  • Increase the turnover tax rate from 1% to 1.25% of turnover

 

Read a May 2017 report [PDF 2.73 MB] prepared by the KPMG member firm in Pakistan

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