ISLAMABAD – The International Monetary Fund (IMF) has rejected the government’s proposal to impose Capital Value Tax (CVT) on movable assets, including gold.
Reports said the government’s attempt to impose CVT on gold, cash, and other movable assets has failed. The global lender also rejected the proposal to impose Federal Excise Duty on day-old chicks.
However, the IMF has allowed the imposition of tax on digital services, from which the government is expecting to generate revenue of Rs10 billion.
Similarly, a proposal is under consideration to increase tax on mutual funds’ dividend income to 20 percent. Additionally, a proposal has been made to raise the withholding tax on interest income to up to 20pc, and the withdrawal of tax exemptions granted to venture capital companies is also being considered.
A proposal to end income tax exemptions for the cinema industry is also under review. Reports further claimed that the 10% surcharge on monthly income of 500,000 rupees will remain in place.
Likewise, the IMF has supported reducing taxes in four middle slabs, and those earning below Rs500,000 are likely to get minor tax relief.
Prime Minister Shehbaz Sharif has been given an initial briefing on the budget. The federal budget will be presented in the National Assembly on June 10, while the Economic Survey will be released on June 9, the third day of Eid.
