Web Desk — The government is likely to bring the banking sector under heavy taxation in the 2023-24 budget as Islamabad looks for easy sources of revenue in a fiscally challenged environment, said a report published in Daily Dawn on Thursday.<\/p>\n\n\n\n
In the report, the head of research at JS Global Amreen Soorani was quoted as saying that the 2023-24 budget would likely carry more negative earnings implications for banks.<\/p>\n\n\n\n
Soorani further said that there\u2019s a likelihood of super tax increasing from the current level of 4% for the banking sector to 10 percent, which will lead to an earnings impact of 13pc for 2023.<\/p>\n\n\n\n
As compared to other corporate entities that pay 29pc, the banking sector already pays a higher corporate tax of 39pc. The banking sector, on other income sources like capital gains and withholding tax on dividends, also pay a 39pc tax.<\/p>\n\n\n\n
According to Soorani, an increase in the super tax to 10pc will result in base earnings estimates declining by 11pc on an annualized basis.<\/p>\n\n\n\n
A flat tax on income generated from federal government securities (FGS), is another likely tax measure in the upcoming budget. Though such tax measures do have similar precedents from the past, it has widely been linked to the respective advances-to-deposits (ADR) level of the bank to encourage lending.<\/p>\n\n\n\n
While disregarding the ADR level, Ms. Soorani said there\u2019s a likelihood of tax on this income to be charged at a flat.<\/p>\n","protected":false},"excerpt":{"rendered":"
Web Desk — The government is likely to bring the banking sector under heavy taxation in the 2023-24 budget as Islamabad looks for easy sources of revenue in a fiscally challenged environment, said a report published in Daily Dawn on Thursday. In the report, the head of research at JS Global Amreen Soorani was quoted …<\/p>\n","protected":false},"author":1,"featured_media":4408,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-4407","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-business"],"yoast_head":"\n