Income Tax Exemptions in Pakistan

In The name Of Allah The Most Merciful & The Most kindly Assignment of Principle & Practice Income levy Topic Need of revenue granting immunity pic Question What is the need of taxation Exemption or Tax Concession in income appraise from government point of view? And Does return income tax granting immunity policy of Pakistan effective in achieving its objectives give comments? tax EXEMPTION According To Community make theoristsTax- resistance contributes to pluralism by providing the public goods and work that either argon undersupplied by the private market or by the government or else not leave aloned in the same socially in demand(predicate) manner NEED OF TAX EXEMPTION Tax Exemption is provided for non-homogeneous purposes discussed below which atomic number 18 ? To Promote sparing action at law ? To Provide Benefit to society ? To Provide Corporate Welfare ? To pull out Businesses ? To Promote Organizations ? To supercharge Religious Activities ? To pull ah ead Economic Activities ? To Encourage Retirement-Led Investment ? To Promote Economic activityTax exemptions are usually meant to either reduce the tax burden on a particular segment of society in the interests of fairness or to promote some type of stinting activity through reducing the tax burden on those organizations or individuals who are involved in that activity. ? To Provide Benefit To Society Tax Exemptions are accorded to certain organizations because they provide a benefit to society which the government is otiose or unwilling to provide. ? To Provide Corporate Welfare Tax Exemption to specific businesses such(prenominal) as Big Oil is for corporate welfare. To Attract Businesses Exemption from property tax and other local tax is utilise as a tool for attracting business to areas suffering from economic devour turn or depression. ? To Promote Organizations Tax Exemption is provided to individuals and organizations to promote economically. ? To Encourage Religious Act ivities Tax exemption is provided to encourage certain social and spectral activities. ? To Encourage Economic Activities Tax exemption is provided to encourage certain economic activities. ? To Encourage Retirement-Led InvestmentTax Exemption is provided on amount of bribe or commutation of person to encourage retirement-led enthronisations. COMMENTS Ignoring all other factors and emphasizing particularly on tax exemption we can comment that, ? Tax exemption has promoted farming sector. Tax is not applied on income generated up to Rs. 80,000, income exceeding from R. s 80,000 will b taxed. The total number of such farmer assesses is reported to be notwithstanding about 20,000 in the completed country with an average of no more than 200 such agriculture income tax payers per district.Thus tax exemption provides relief to people booked in tax exemption. ? Tax exemption has promoted scholarships in the country as the ratio of scholarships have increased from last decades which is providing opportunities to many students to not only study in Pakistan but also abroad. Tax exemption from scholarships is salutary for both students and country. ? Tax exemption has promoted immense unlike presentment in Pakistan as China has started many projects in Pakistan not only because of ratty labor but also because of tax exemption. Similarly many other foreign projects are practicing in Pakistan. Tax exemption has promoted many investment banks as Modarba, macro finance bank, national investment trust etc which provide many easy loans to people and firms which in turn contribute in promoting society. ? Tax exemption policy has promoted many sectors as businesses, educational sector, foreign investment, NGOS etc Thus, We can conclude that present tax exemption policy is providing many incentives to people, starting new businesses and is encouraging people to invest more and more in various sectors which in turn are generating income to the economy.It is because of tax exemption that many projects have started in special industrial zones in Pakistan as Export processing zone, North Western industrial zone, Eastern Western Industrial zone and many more. Tax exemption policy in many areas as income earned from foreign enterprise, pileus gain by foreign institutional investor, income from transport businesses has widened the approach of business. So present income tax exemption policy of Pakistan is effective in achieving its objectives. pic