The World Bank has backtracked on its claim that anyone making less than Rs. 50,000 per month should be subject to taxes.
A Tribune article citing new data reported that Pakistan’s salaried class paid more taxes in the last three months than the wealthiest exporters and real estate industry combined.
For comparison, the taxes paid by Pakistan’s salaried population over the period amounted to Rs. 71 billion, which is six billion more than the taxes paid by the country’s exporters and real estate industry. Even while exporters and the real estate industry earn far more money, the salaried class still makes a larger contribution.
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According to the World Bank’s explanation, the proposal to tax individuals making less than Rs. 50,000 per month was based on data from 2019 that has to be revised.
He said, “The World Bank certainly does not recommend any reduction in the current nominal threshold, and how it was framed above may have indeed been misleading.”
PSR cut the 2019 income tax salary exemption. The statement recommended salary decreases based on labor market and inflation data.
It admitted its errors: “The recommendation in the Pakistan Development Update should have been clearer on the need for new analysis on more recent data to inform this reform.”
It recommended adjusting tax thresholds based on fresh survey results to safeguard low-income people.
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