September 25, 2020

FBR Will Collect Lifetime Income Tax On Vehicles Up To 1000cc

FBR has recently put into effect policy for charging fixed lifetime income tax for cars up to1000cc engine capacity. Previously the car owners had to pay PKR 1800 annually, from which Rs1000were charged as token tax and Rs800 were collected as income tax.

According to the new policies, the filers would have to pay Rs20,000as lifetime token tax, from which Rs10,000 will be collected as lifetime income tax and Rs10,000 as lifetime token tax, as per the new policy introduced by the interior ministry in the Finance Act, 2019. The Non-filers would have to pay an additional Rs10,000 and the policy has been in effect since July 1, 2019, in Islamabad and Sindh.

The pensioners on the other hand, who are not required to file income tax, will be exempted from this scheme and will have to submit a special application to the commissioner, mentioning the reason for not filing income tax. The commissioner would have to reply to that application within  30 days time period, if the commissioner does not give any response in the prescribed time limit, then the applicant will automatically be exempted from tax collection, no matter the reason.

According to dawn, FBR spokesperson Dr. Hamid Ateeq said that they had no option other than to take lifetime income tax and token tax on vehicles less than 1000cc. He further said that if the government decides to apply the same policy to all other engine capacity vehicles, the FBR had already made the rate list for the fixed taxes for different engine capacity vehicles.

The excise department has also introduced this policy for motorcycles and rickshaws of Sindh and Islamabad. Whereas the excise departments of KPK and Baluchistanhave still not implemented this policy.

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