Salaried individuals paid Rs144 billion in income tax in the first quarter of the current fiscal year, Rs90 billion more than the retail and real estate sectors contributed together, according to preliminary data from the Federal Board of Revenue (FBR).
The two sectors paid a combined Rs54 billion between July and September. In contrast, collection from the salaried class rose Rs13.4 billion, or 10.2 percent, compared with the same period last year.
Real estate collection fell 38 percent to Rs35.2 billion from about Rs57 billion a year earlier. The decline followed the decision of the government to cut advance tax rates on property transactions this fiscal year.
The rate on sales was halved from 5.5 percent to 2.75 percent, and the rate on purchases from 2.5 percent to 1.25 percent. Collection on sales dropped from Rs39.5 billion to Rs23 billion, while collection on purchases declined from Rs17.7 billion to Rs12.2 billion.
Withholding tax receipts from the wholesale and retail sectors remained largely flat at Rs18.4 billion, up just 1.3 percent year-on-year. Wholesalers paid Rs6.2 billion, Rs701 million less than last year, while retailers paid Rs11.3 billion, up Rs945 million, or 8.3 percent.
The figures come despite the claim that the budget for the current fiscal year gave the salaried class relief of about Rs52 billion. The package included a reduction of up to 3 percentage points in tax rates, the abolition of the 9 percent surcharge, and an increase in the income threshold for the top 35 percent rate from Rs4.1 million to Rs7 million annually.
The annual tax payments of the Salaried individuals stood at Rs391 billion before the International Monetary Fund (IMF) programme began. They rose to Rs629 billion by June this year, over two fiscal years.
Meanwhile, the government introduced a fixed tax scheme to bring traders into the tax net, but FBR data shows no significant increase in retail sector collection.
