Beware; you might lose half of the wealth thanks to a new tax imposed by the federal government in the budget 2023-24.
The new tax is called the “additional tax”, which is applied to any person or group of people who have made extraordinary profits due to unexpected factors. The tax rate for this additional tax will not be more than 50 percent of the income, profit, or gains.
The additional tax is included by the Federal Board of Revenue through a new section “99D” (Additional tax on certain income, profits, and gains) in the Income Tax Ordinance 2001.
The new tax will be applicable on every person who has any income, profit or gains that have arisen to any person or class of persons due to any economic factor or factors that resulted in unexpected income, profits or gains even if they did not disclose it in their financial statements.
The government will finalise the economic factors that led to the unexpected income, profits, or gains through an official notification.
These would include: profit or gains on account of foreign currency fluctuation; provide the rate not exceeding fifty percent of such income, profits or gains; provide for the scope, time and payment of tax payable under this section in such manner and with such conditions as may be specified and exempt any person or classes of persons, any income or classes of income from the application of this section, the Finance Bill 2023 added.