ISLAMABAD
Federal Constitutional Court (FCC) has issued detailed decision of super tax case. Chief Justice (CJ) FCC Amin ud Din Khan has issued a detailed 293-page decision.
FCC has declared implementation of super tax constitutional under section 4-C of income tax ordinance-2001.
Implementation of super tax will be considered an independent and separate tax from income tax.
FCC declared null and void Islamabad High Court (IHC) decision against section 4-C. Under section 4-C this tax will stand implemented from tax year 2022 and the succeeding years.
Parliament is fully empowered to slap tax on earning under income tax ordinance. Issuance of directive by IHC to FBR to issue circular is beyond jurisdiction powers. Super tax is separate from general tax and it is not its substitute. 4-C will be applicable to those all incomes which come under separate tax regime. Super tax will be applicable to increase in capital under section 4C.
Super tax will be applicable to petroleum and exploration companies under specific legal limits and agreements. Imposing tax from past through legislation is legally justified. Imposing super tax at higher ratio on specific sectors is not discriminatory treatment. But it is power of law makers.
Super tax will be applicable to such income where basic tax is applicable. Income exempted from tax is exempted from super tax as well. Super tax will not be applicable to the income on which tax is not applicable under law. If there is tax exemption on sale of property or shares, then super tax will not be applicable. It will not be applicable to inheritance or income accrued after a specific period. Super tax will not be applicable to income or sale of agriculture land.
