Home Research PapersWHAT the betterment and to build up the development

WHAT the betterment and to build up the development

WHAT
IS TAXATION?

Tax or any payment which is binding
upon such person to pay towards them.

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A source or a process by which
government imposes charges or some duties in form of The purpose behind such
step is to encourage the society by providing them facilities and different
sources..for example. The construction of roads for transportation, further to
promote education for betterment of society and so on many things related to
it.

 

Importance
of tax:

Basically tax is initiated for the betterment and to
build up the development for all over the country. The basic importance to
create a creative welfare the country

Government raise their revenues in term of  income tax, sales tax, custom duty, GST and
land revenue taxes like property tax etc.

They also regulate the economic stability by the
production of useful products and discouraging the production of harmful products

History:

Taxation law was imposed by the British government
which was later on followed by the different countries like Pakistan and India.
As a result of British rule. When Pakistan came in to existence on 14th
august 1947. The government of  Pakistan adopted
the 1860 act which is known as income tax act 1860 imposed by british regime

The very first income tax act was imposed with help
of first financial minister James Wilson

The purpose was to collect the tax by

Income from land property

Income from profession and trade

Income from security

Dividends

Income from salaries and pensions

Exemptions:

Income up to 200 Rs by general public

Military and police officers salary  up to   Rs 4980

In agriculture field 2% income tax imposed ranging Rs
200 to 499

4% income above 499

Imposition
of income tax act,1922:

The Pakistan government adopted the 1922 act of
income tax.this act was imposed on all over Pakistan except few areas in
country.

1958:

An inquiry committee regarding taxation matters was
introduced which was the first committee in history of Pakistan.the officials
and trade representatives were involved trade and commerce field

Recommendations:

after very deep analysis of tax system the officials
give recommendations from time to time regarding tax system.

Abolishment
of tax:

a term super tax was introduced which purpose was to
apply a certain tax on income on all persons of Pakistan .Later on it was
dismissed until rate slab was imposed in 1959.

Change
in financial year:

The financial year was dated from 1st April
to 31st march before 1960s but on 1960 is was amended from 1stJjuly
to 30 June.

Income
tax committee:

A committee was introduced by FBR in 1961,the basic
purpose was to regulate the laws and procedure according to given criteria in
1922 act the several recommendations were made.

self
assessment scheme:

an officer was authorized to inquire the tax system
of  person or individual. A recommendations
was made to offer individuals to gain self assessment. So a self assessment scheme
was introduced in 1965.

 

Promulgation
of income tax ordinance,1979:

due to a lot of amendments a flow was created regarding
the procedure of tax laws. So there was a need of fresh act. In 1979 a new act
was introduced with further recommendations but the basic concept was same as
given in 1922 act.

NTRC:

National tax reform commission was made with the concern
to improve the structure of law present .Members of parliament, bureaucrats and
industrialists were involved to introduce the tax reforms.

Income
tax ordinance,2001:

in previous act of 1979 a lot of recommendations
were made which purports to give benefit the holders of black money. So that,
they are able to change it in white money. As there were also a lot of amendments
were made so a new recommendation were given by NTRC. Whose purpose was to
formulate the new procedure of taxation laws, which was promulgated on
15.06.2002 and was named as income tax ordinance 2001. Which was extend to
whole Pakistan.

Purpose:

The purpose was to amend the law and consolidate it
relating to tax laws.

Income
tax rules 2002:

After the enactment of the act the rules were
introduced regarding tax law. Rules are basically consisted of procedure. That how
to regulate the concerned matter. There rules were introduced by FBR according
to section 237 of income tax ordinance 2001. And was published on July 1st
2002.

Finance
act 2009:

As there is a need to update the law according to
the change of time. Different methods are adopted by competent authorities like
sros and circulars. Finance act is the main source to update the change from
time to time and it is presented in the month of June every year.

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