KARACHI: Economic and financial analyst, Ateeq Ur Rehman, has urged the government to reconsider its decision regarding the huge increase in wage earners’ tax obligations.
It is very important to note that the working class is a major contributor to the country’s tax net, he said. The collection target set at 7470 billion rupees with an additional tax increase of 466 billion rupees on the impact of business income of about 35 billion rupees calculated from the salaried class only, following the withdrawal of tax relief of Rs. 47 billion.
For example, under the proposed upward revised tax bracket, an employee’s salary bracket of Rs. 100,000 to Rs. 200,000 will now pay a tax of 12.5% from the previous rate. 7.5%. This means that he is required to pay Rs. 26,250 per month or Rs. 315,000 per year. The current tax liability of this salary bracket was Rs. 120,000 per annum reflecting a huge increase in tax payment, Ateeq said.
The working class is already under the weight of skyrocketing inflation, high electricity charges, high gasoline prices and was considering raising their employers’ salaries to meet rising expenses, but a huge decrease due to the liability to payroll tax be an obstacle to meet the daily expenses by them.
Copyright Business Recorder, 2022