Government Put forward Decreasing the Super Tax and Corporate Tax
As the latest Budget 2018-2019 has been presented so here are a lot of new things like somewhere you will find increase but somewhere decrease; same is the case with super tax and corporate tax that has been reduced. The government has offered to decrease the super tax thru 1% per year; as of the fiscal year 2018-19 on behalf of both banking and non-banking companies. The super tax was imposed in 2015 for rehabilitation of internally displaced persons. It was continued in 2016 & 2017. A number of civil services have called for its elimination to diminish the real tax rate. It is presently being charged @ 4% on banking companies & 3% on non-banking companies taking proceeds over and above Rs. 500 million.
Govt Decrease Corporate Tax
The corporate tax has also been proposed to reduce. In consonance with the policy to reduce tax rates for people and AOPs. Moreover, the Government has determined to similar to the above mentioned cut in corporate tax rates from 30% in the tax year 2018. furthermore, to reduce more 25% in the tax year 2023. at present, the corporate tax rate will be 29% in the tax year 2019, besides it will be decreased by 1% every year up to the tax year 2023.
Tax on undistributed profits is accused at 7.5% on accounting profit if no less than 40% of after-tax profits are not distributed within six months of the end of the year. A lot of professional figures have emphasized on relaxing the conditions to help businesses in preserving earnings for investments. Consequently, it is recommended that tax may be decreased; from 7.5% to 5% and the state of dealing 40% after-tax profits may be diminished to 20%. With the intention of encouraging Real Estate Investment Trust; the rate of tax on dividends give out to the part holders by REIT is proposed to be reduced as of 12.5% to 7.5%.