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Income tax rates describe the percentage at which individuals, corporate entities, or other organizations are taxed. In Pakistan, the Federal Board of Revenue (FBR) employs a progressive tax rate system, meaning the tax rate increases as the taxable income of a person or entity increases. This results in a higher rupee amount collected from taxpayers with greater incomes.
To build and maintain the infrastructure of the country, the government taxes its residents. The collected tax is used for the betterment of the nation and its society. In Pakistan, a tax rate is applied to various forms of income, such as salary, wages, investment income (dividends, interest), capital gains from investments, and profits made from goods or services rendered. The percentage of the taxpayer’s earnings or money is taken and remitted to the federal government.
When it comes to income tax, the tax rate is the percentage of an individual’s taxable income or a corporate entity's earnings owed to the federal government. The applicable tax rate for an individual depends on the marginal tax bracket they fall under, which is based on the taxable income exceeding a pre-defined limit.
Withholding Tax Rates on Imports
Sec. 148, Part II, 1st Schedule | Part I-III, Twelfth Schedule
The rate of advance tax to be collected by the Collector of Customs.
Sec. 148
Sec. 149, Division I, Part I, 1st Schedule
Where the income of an individual chargeable under the head "salary" exceeds seventy-five percent of their taxable income, the tax rates apply, which remain unchanged from the previous tax year.
Division I, Part I, 1st Schedule
No changes in tax rates for individuals and associations of persons. The applicable tax rates for the Tax Year 2022 are set out in the following table:
Division II, Part I, 1st Schedule
Tax rates for banking companies, public & private companies, small companies, alternate corporate tax, and modarabas are provided in the following table:
Rate of Super Tax on high-earning individuals (Sec. 4C)
Sec. 150
A person paying a dividend shall deduct tax from the gross amount of the dividend or collect tax from the amount of dividend in specie.
Sec. 151, Division 1A & 1B, Part III, 1st Schedule
Sec 152, Division IV, Part I, 1st Schedule
Sec. 153, Division III A, Part III, 1st Schedule
Sec. 154 & 154A, Division IV, Part III, 1st Schedule
Sec. 155, Division V, Part III, 1st Schedule
Sec. 156, Division VI, Part III, 1st Schedule
Sec. 156A, Division VIA, Part III, 1st Schedule
Sec. 231B & 234, Division VII, Part IV, 1st Schedule
Sec. 233, Division II, Part IV, 1st Schedule
Sec. 235, Division IV, Part IV, 1st Schedule
Sec. 236, Division IV, Part IV, 1st Schedule
Sec. 236A, Division VIII, Part IV, 1st Schedule
Sec. 236C & 236K, Division X & XVIII, Part IV, 1st Schedule
Sec. 236G, Division XIV, Part IV, 1st Schedule
Sec. 236H, Division XV, Part IV, 1st Schedule
Sec. 236I, Division XVI, Part IV, 1st Schedule
Sec. 236Q, Division XXIII, Part IV, 1st Schedule
Sec. 7B, Division III A, Part I, 1st Schedule
Sec. 5AA, Division IB, Part III, 1st Schedule
Sec. 15, Division V, Part I, 1st Schedule
The rate of tax on cash-settled derivatives traded on the stock exchange shall be 5% for the tax years 2018 to 2020.
A Mutual Fund, Collective Investment Scheme, or REIT Scheme shall deduct Capital Gains Tax at the rates specified below on Redemption of Securities:
If the dividend receipts of the fund are less than capital gains, the rate of tax deduction shall be 12.5%.
No capital gains tax shall be deducted if the holding period of the security is more than 4 years.
Sec. 37(1A), Division VIII, Part I, 1st Schedule
Sec. 37(3A)
Sec. 7C, Division VIII A, Part I, 1st Schedule
Sec. 7D, Division VIII B, Part I, 1st Schedule
Sec. 113, Division IX, Part I, 1st Schedule
Clause (2), Part III of 2nd Schedule
Sec. 147
Advance Tax on Transactions in Bank [Transferor]
Advance Tax on Banking Transactions Otherwise Than Through Cash [Receiver]