In a recent development, the World Bank has reevaluated its previous recommendation regarding the taxation of monthly salaries below Rs 50,000. This announcement comes in response to changing economic conditions and the need to update their stance based on recent inflation and labor market trends.
The World Bank’s initial recommendation was rooted in data from 2019, which has since become outdated in light of evolving economic circumstances. As a result, the organization has decided not to advocate for any reduction in the existing taxable slab limit.
Notably, the World Bank’s decision aligns with data from the Federal Board of Revenue (FBR), which revealed that the lower-income salaried class contributes a significant share of taxes compared to other sectors, including wealthy exporters and the real estate industry. These findings underscore the importance of maintaining the current tax thresholds.
A spokesperson for the World Bank responded to media inquiries by emphasizing that the organization is not proposing a specific new level of income tax exemption at this time. Instead, they are recommending the initiation of a fresh survey to comprehensively assess income levels and the economic landscape.
The World Bank believes that any adjustments to tax thresholds should be made based on the data collected through this new survey, ensuring a fair and accurate representation of the current economic conditions. This approach reflects the organization’s commitment to providing well-informed and equitable fiscal recommendations to support economic growth and stability.
