TechX Pakistan reports on the latest budget proposals for 2024-2025. Here are the key highlights:
Grade 17-22 Salaries Rise by 22% in FY24-25 Budget
The government plans to collect Rs. 12,970 billion. This is 38% more than this year. They will spend Rs. 18,877 billion. Out of this, Rs. 9,775 billion goes to interest payments.
The GDP growth rate will be 3.4%. They expect 12% inflation. The budget deficit will be 6.9%. They have allocated Rs. 1500 billion for the Public Sector Development Program (PSDP).
This is the highest ever. The minimum wage rises to Rs. 36,000 from Rs. 32,000. Salaries for grade 1 to grade 16 staff will go up by 25%. Salaries for grade 17 to grade 22 staff will rise by 22%.
Higher GST on Leather and Textile Goods
The government shifts from a government-controlled economy to a market-driven one. They show strong interest in boosting the IT sector. They want to increase IT exports.
The income tax slab for salaried people has changed. The minimum tax exemption stays at Rs. 600,000. Exporters will pay a 29% tax rate.
Advance income tax for non-filers rises from 1% to 2.5%. Motor vehicle registration tax will now be based on cost value.
Retailers of leather and textile products will charge 18% GST. All mobile phones will have an 18% sales tax. Bronze, coal, paper, and plastic scrap fall under the sales tax withholding regime.
Iron and steel scrap are exempt from sales tax. FATA and PATA districts lose their tax exemptions after July 1, 2024.
Budget Increases Taxes on Petroleum Products
Capital gain tax on immovable property for non-filers will be up to 45%. For filers, it will be 15%. The same rates apply to securities.
The default surcharge on unpaid sales tax and FED rises to KIBOR+3 from 12%. Acetate tow, used for cigarette filters, will have a Rs. 44,000 per kg FED. The levy on petroleum products increases.
The FED on cement rises to Rs. 3 per kg from Rs. 2. A 5% FED will be imposed on immovable property.
Import Relief for Solar, Higher Duties on Steel
There are concessions on imports for aquaculture seed and feed. The solar panel industry gets import concessions.
This includes machinery and materials for making solar panels, batteries, and inverters. Hybrid cars lose their customs duty exemption. Import duties on steel and paper industries increase.
To read our blog on “Income tax rates doubled to 35% in new budget” click here.