ISLAMABAD: The Federal Board of Revenue (FBR) is considering raising advance tax on motor vehicle registration by 10 to 35% based on vehicle value with a few days left in the budget, The News reported Wednesday.
The advance tax is now based on engine capacity, but the forthcoming budget, scheduled in the first week of June, may make big changes.
The Resource and Revenue Mobilisation Commission (RRMC) proposes vehicle-value-based advance tax.
The RRMC proposed a 2% advance tax for corporates and 3% for non-corporates and those in the active taxpayers list (ATL) for three years on motor vehicles worth up to Rs10 million.
Moreover, 10% is the proposed per-person tax. For motor vehicles worth Rs10 million to Rs30 million, corporate and non-corporate sectors would pay 4% and 5%, respectively, if they have been in ATL for three years.
While, Corporate and non-corporate sectors would pay 6-7% tax on vehicles worth Rs30–100 million. Persons would pay 30% more in taxes.
Moreover, Corporate and non-corporate sectors in the ATL for three years would pay 8% and 10% for automobiles up to Rs100 million. Persons will pay 35%.
The RRMC suggested a minimum tax of 3% of gross turnover for transport services delivered to a withholding agent.
Transport contractors pay 3.5% of gross revenue for carrying services. Oil tanker contractors pay 2.5% tax.
