Pakistan: Income tax measures in “mini budget”

Pakistan: Income tax measures in “mini budget”

The Tax Laws (Second Amendment) Ordinance, 2021—being referred to as a “mini budget” includes the following income tax provisions:

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  • Industrial undertakings would no longer be specified by the Federal Board of Revenue by a notification published in the official gazette.
  • Change to treatment of first year allowance would apply for installing plant, machinery and equipment by certain industrial undertakings.
  • Scope of tax credit would be enhanced for charitable donations.
  • Tax credits for hiring recent graduates by a person would no longer be available.
  • A 100% tax credit would be introduced for certain persons whose income was previously exempt under the “Second Schedule.”
  • A new tax credit would be introduced for specified industrial undertakings.
  • There would be a simplification of tax credit for charitable organizations.

Read a March 2021 report [PDF 288 KB] prepared by the KPMG member firm in Pakistan 

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