Monday, May 23, 2022

Noteworthy changes in the incentive package


Islamabad: The government has made a significant change in the incentive package for the business community within 24 hours after it had been announced by Prime Minister Nawaz Sharif.

“No limit has been fixed for investment in the green field industrial and expansion projects that also include captive power plants, low-cost housing construction, livestock and mining and quarrying in Thar coal project, mining projects in Balochistan and Khyber Pakhtunkhwa and other expansion projects provided these are set up on or after Jan 1 next year,” said a statement issued by the Prime Minister’s Secretariat on Friday.

The prime minister further added that government and tax authorities would not ask questions about the source of investment if it was between Rs10 million and Rs50 billion.
The minimum limit is changed from Rs25m to Rs10m. He read out a negative list of industries which would not be entitled to the incentives. However, on the demand of businessmen he said the list would be finalized later on the basis of their suggestion.
The negative list included arms and ammunition, explosives, fertilizers, sugar, cigarettes, aerated beverages, cement, textile spinning mills, flour mills and vegetable ghee and cooking oils.

The statement said the multi-pronged tax incentive package was aimed at promoting investment, creating jobs, simultaneously increasing tax collection and the number of tax return filers and acknowledging leading taxpayers.
The finance ministry criticized the PPP and said the stimulus package for stock exchanges introduced by its government had exempted from scrutiny the nature and source of investment in listed companies and share of public companies subject to certain conditions. But the present government has decided to shift the focus to promoting industrial growth.

It said that with the aim of increasing income tax collection and simultaneously facilitating the existing taxpayers by providing them an option to avoid tax audit, the prime minister had also allowed immunity from tax audit those taxpayers who paid 25 per cent more tax this year than paid or assessed for the previous year.
The prime minister had also extended the deadline for filing tax returns to Dec 15 from Nov 30 and said those who had already filed returns would be free to revise them till the new deadline in the light of new incentives.


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