The federal government has refused to share taxpayers’ income tax return data with provincial authorities, citing confidentiality restrictions under Section 216 of the Income Tax Ordinance (ITO).
During a recent National Tax Council (NTC) meeting, chaired by Finance Minister Muhammad Aurangzeb, the Federal Board of Revenue (FBR) expressed its willingness to provide provinces with specific data, including agricultural and property income, in line with their needs.
A key topic of discussion was the taxation of livestock income. Punjab opposed excluding livestock income from its new agriculture tax law, which was passed in accordance with International Monetary Fund (IMF) guidelines. The matter has been referred to the NTC executive committee for further deliberation.
The IMF has set a deadline of October 2024 for provincial agriculture tax rates to align with federal personal and corporate income tax rates. While Punjab has passed the necessary legislation, it has not provided rate details, and other provinces are still non-compliant.
Property tax issues were also raised, with Punjab considering a shift from rental value to capital value for urban property taxation. The executive committee has been tasked with standardizing property valuation methods and digitizing records to improve assessment processes.
Proposed amendments to Section 216 of the ITO were also discussed, with the potential to enhance revenue collection if implemented as part of the government’s broader tax reforms under the Tax Laws Amendment Bill.
