KARACHI:
The Institute of Cost and Management Accountants of Pakistan (ICMA) has released a report in its latest issue of the ICMA Economic Intelligence, highlighting the significant challenges of enforcing the newly introduced agricultural income tax.
The tax, implemented under the International Monetary Fund (IMF) conditions, has rates between 15% and 45%, with a 10% super tax on high-income landowners. This makes Pakistan’s agricultural tax among the highest in the region, surpassing neighbouring countries like India, Bangladesh and Sri Lanka.
The report emphasised the difficulties in enforcement due to outdated land records, fluctuating farm incomes, weak tax collection mechanisms and political resistance. Small farmers are particularly vulnerable, with the risk of higher product prices and inflation.
ICMA suggested a gradual implementation, starting with large landowners, and called for modernising land records, enhancing digital tools and providing incentives to improve compliance.
