Pakistan Federal Budget 2023

1. Income Tax Amendments: The Finance Bill proposes several changes to the Income Tax Ordinance. These include:

• Revision of tax slabs and rates for individual taxpayers.
• Introduction of a minimum threshold for penalty amounts.
• Amendments in the provisions for filing tax returns and assessments.
• Measures to enhance the use of technology and facilitate e-filing.

2. Sales Tax Amendments: The Finance Bill also suggests amendments in the Sales Tax Act. Key changes include:

• Rationalization of sales tax rates on various goods and services.
• Exemptions and reductions in sales tax for specific sectors, such as healthcare, agriculture, and education.
• Measures to improve the efficiency of sales tax collection and administration.

3. Customs Act Amendments: The proposed amendments in the Customs Act focus on simplifying procedures, enhancing transparency, and reducing compliance burdens. Some significant changes include:

• Expansion of the scope of excisable services to include franchise services, royalty, and fees for technical services.
• Amendments in the definition of smuggling to empower Customs authorities across the country.
• Power to exempt goods based on agreements between the Government of Pakistan and entities.
• Validation of exemption notifications issued since July 1, 2016, subject to ratification.
• Introduction of advance ruling provisions to seek clarity on customs-related matters.

4. Federal Excise Duty (FED) Amendments: The Finance Bill proposes amendments to the Federal Excise Act, including:

• Extension of the scope of excisable services to include franchise services, royalty, and fees for technical services.
• Revision of FED rates for specific services and goods.
• Introduction of a minimum threshold for penalty amounts.