Islamabad, June 21, 2025: In a bold move, the Punjab government has introduced a significant increase in agricultural income tax for the fiscal year 2024–25, aiming to generate Rs 10.5 billion in revenue — nearly triple the collection from last year. This development marks a drastic policy shift in the province’s approach to taxing the agricultural sector.
According to official budget documents, commercial-scale farms will now be taxed under corporate regulations, aligning them with business entities across other industries. This step not only expands the provincial tax net but also reflects Punjab’s efforts to formalize revenue streams from large-scale agricultural operations.
The newly implemented Agricultural Income Tax (Amendment) Act 2024 also introduces a super tax on high-income individuals involved in agribusiness, signaling a stricter stance on wealth redistribution and financial compliance. Furthermore, penalties and default surcharges have been sharply increased for those who delay filing or default on their tax payments.
Analysts view this aggressive tax revision as part of Punjab’s broader fiscal reform agenda. By setting a Rs 10.5 billion target, the government is sending a clear message: high-value sectors must contribute fairly to provincial development.
The latest taxation framework is expected to spark debate among stakeholders in the agricultural sector, with many calling for clarity on how the tax will impact smallholders versus large corporate farms. As the policy unfolds, all eyes remain on how effectively it can be implemented without disrupting food security and rural livelihoods.
Read More: Finance Bill 2025: What’s Troubling About the New Tax Changes?
