Islamabad, Dec 26: The federal government has decided not to share taxpayers’ income tax returns with provincial authorities, citing confidentiality laws under Section 216 of the Income Tax Ordinance (ITO). This provision prohibits the sharing of such sensitive data.
During a recent meeting of the National Tax Council (NTC), chaired by Finance Minister Muhammad Aurangzeb, the Federal Board of Revenue (FBR) expressed its willingness to share specific data relevant to provincial authorities, such as agricultural and property income. However, the sharing of full income tax returns remains restricted under the existing legal framework.
One of the major points of discussion at the meeting was the issue of taxing livestock income. Punjab has refused to remove livestock income from its new agriculture tax law, which was enacted in line with the International Monetary Fund (IMF) requirements. The matter has been referred to the NTC executive committee for further deliberation.
The IMF had earlier set a deadline of October 2024 for provincial agriculture tax rates to align with federal personal and corporate income tax rates. While Punjab has passed the necessary legislation, it has omitted the specific tax rates, and other provinces have yet to comply with the IMF’s stipulations.
In addition, the meeting addressed the issue of property taxes. Punjab is considering shifting from a rental-based to a capital value-based taxation system for urban properties. The NTC executive committee has been tasked with standardizing property valuation methodologies and digitizing property records to ensure more efficient assessments.
The meeting also touched on proposed amendments to Section 216 of the ITO, which are part of the federal government’s broader tax reforms under the Tax Laws Amendment Bill. These changes are seen as a step towards improving revenue collection if implemented effectively.
