Why is the salaried class in Pakistan heavily taxed?
Inflation in Pakistan has damaged the backs of the low-income and moderate class, and everyone is uneasy. The irony is that now the salaried people will be forced to pay even more taxes, and many will be taxed up to 40% of their income. Most of the salaried class are being taxed more than their capacity, so why more taxes on those who are already under the burden of taxes, and why those who do not pay taxes or pay less than their income are exempted.
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Why the Salaried Class in Pakistan Faces a Heavy Tax Burden
The current government has also done what the previous governments have been doing, instead of making difficult decisions, squeezing the same easy work more on what is in front and stuck in the tax net.
On the one hand, the government is trying to improve the economy, but on the other hand, instead of necessary reforms, it is engaged in such activities which will not benefit the economy at least, for example, trying to ban PTI, and arresting political workers. If you look at the legislation suppressing dissenting voices and the control ground situation on social media, the problems of ordinary Pakistanis look very different.
Earlier the tax on salary was 2.5% and from now on it will be a 5% tax cut on salary.
How broadly is a tax on pay in Pakistan?
Interview of a citizen of Rawalpindi: Earlier the tax on salary was 2.5% and from now on, there will be a 5% tax cut on the salary. The most prominent payment is apparently the electricity bill. Apart from your cost of living, groceries, etc.
The same inflation, the same complaint of high taxes, who pays how much tax in Pakistan?
In the fiscal year 2022-23, the government received a total income of more than 7 thousand billion rupees in terms of taxes, in which the share of income tax was more than 3200 billion rupees.
In which 276 billion vises more was received from the salaried class
In comparison, despite the exports of 27 billion dollars, only one percent tax was taken from the exporters, which was only 77 billion rupees, while the agricultural sector paid only 0.1 percent income tax. More than 436 billion rupees have been fixed for which the tax rate has been increased to 40%.
Now you tell yourself when these profiles of taxpayers and non-payers will be angry or not.
Citizen's statement: It is sad because the sold class is the only class that is paying tax, the salary tax is taken in the price and you are imposing inferior taxes on them also, it has become challenging to live anymore. You have no savings left that you can use at any time when you are in trouble.
The sovereigns of Pakistan may not comprehend the despair of the people
Finance Minister Muhammad Aurangzeb says that Pakistanis will also have to pay as much tax as people in developed countries take tax.
Personal Income Tax Reforms need to be implemented to bring the Personal Income Tax rate in line with international standards,
Give an example of the finance minister of the countries
But in the countries where the Finance Minister is giving the example, they should also keep in mind the free facilities provided to the taxpayers, such as quality education for children, health, security, transport, and the best sanitation system. They demand all these facilities in return,
Pakistan's largest middle class lives in Karachi, recently hundreds of employees of many companies protested in the city center and these people are preparing for more protests. Salaried people and women are not part of the protest. They go to the office and home in the evening, but now this section is also forced to go out on the streets. It is easy to collect tax from salaried people because their tax is deducted ex-source, that is, as soon as they get their salary, it is after the tax is deducted. As a result, people have started looking for other ways to save tax.
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Interview with Wahaj Siraj CEO, Niyal: Employees are demanding that the salary we have should be given in cash.
And when the pressure on the middle class increases and its purchasing power decreases, it is not good for the economy either.
Interview with Hazima Bukhari Economist:
If he can't meet all these, then how will he get the money to buy more which will lead to a lack of demand in the entire economy which will obviously affect the economy.
The irony is that the government is not only able to increase its tax net but also gives exemptions of more than four trillion rupees.
The government of Pakistan obviously wants to get out of this economic crisis, but to improve the economy, not only government spending and inefficiencies must be eliminated, but also production and exports must be increased and the tax net must be widened to collect taxes from the salaried class. Instead of taking the easy way out, the government should levy taxes on the exempted sectors.
Like the agriculture sector which is not fully taxed, military personnel and bureaucrats have also been exempted in several terms, how do citizens struggling to meet their expenses feel when they see that some People are being given tax exemptions and more burdens on them,
A citizen's statement: It is a big disappointment and a demotivation for the youths who want to work in this country for the development of this country, but because of what it is, they are unable to give their input to others. They do what they can to the extent of being frustrated and leaving the country.
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