The Central Directorate for National Savings (CDNS) has notified a 50 per cent increase in the income tax rates on the profits earned by making investments in various government schemes – a move which may further discourage small investors from putting their money in these schemes, according to a report by the Express Tribune.
Effective from July 1, the rate for tax-for-profit on debt imposed under Section 7B (of the Income Tax Ordinance) shall be 15pc, according to a notification issued by the CDNS. However, persons not appearing in the active taxpayers list will be charged at 30pc income tax rate, it said.
The CDNS, a headless department for the last three years working under the Ministry of Finance, issued the notification after the government changed the tax rates in the budget with effect from July 1. The previous tax rates were 10pc and 20pc.
The 15pc and 30pc income tax rates are only for those who would earn a profit of up to Rs500,000. If their profit margins exceed the Rs500,000 threshold, they will be charged standard rates – up to 35pc.
Fools chocking their own economy by raising tax so they can get few billion from IMF.