Categories: EducationNews

Government imposes another tax – this time on Education sector

The Government has imposed yet another tax, but the new tax isn’t targeted towards the IT sector but the education sector. The government has issued a 5% Withholding Tax (WHT) on all educational expenses for foreign education. The tax was introduced in the Finance Bill 2015. The tax applies to any Pakistani looking to send money overseas for the purposes of education i.e. fees, living expenses, etc.

See Also: Government implements 14% Advance Tax on Internet Connections Across Pakistan

The new tax imposed by the Government will now charge all remittances a 5% WHT dealing with any finances being sent abroad for educational expenses. The tax will be applicable on the following educational expenses: boarding and living expenses, paying for distant learning to an institute abroad, any expense related to foreign education and tuition fee.

The tax will be collected by any and all financial institutions that participate in the remittance process, these include, banks and other financial bodies that will help send the money abroad. Though, the tax is adjustable to the senders income as well.

See Also: Government imposes 8% minimum tax on service providers irrespective of profit or loss

The government has also set a limit on the amount being sent abroad. Outbound remittances are limited to $70,000 for tuition expenses and $5,000 for living expenses as the upper limits per annum. The stated amount also applies to all other currencies as an upper limit. This means the upper limit isn’t only on the USD, but also the Euro, Pound, etc., to the equivalent sum of $70,000 and $5,000.

Tax experts have stated that the government should also consider amending section 111(4) of the Income Tax Ordinance to help identify the person sending the money from Pakistan. This should be done in order to prevent black money generation, they believe that the system can be exploited for money laundering purposes.

What are your thoughts on the recent spree of taxes? Let us know in the comments section below.

Source: The News

Sponsored
Rizwan Anwer

Share
Published by
Rizwan Anwer

Recent Posts

Rumors Indicate iPhone 17 May Feature Unconventional Camera Design

Apple is reportedly preparing for a significant design overhaul with its iPhone 17 series, blending…

15 hours ago

First AI-Powered Teacher Launched in Pakistan’s Private School

Karachi: A private school in Karachi has unveiled Pakistan’s first AI-powered teacher, a groundbreaking move…

16 hours ago

Yahoo Surprises Users with Its Latest Android Launcher

Third-party apps have long been a staple of the Android ecosystem, but their appeal has…

18 hours ago

Phase-II Review of PTCL-Telenor Deal Finalized by CCP

ISLAMABAD: The Competition Commission of Pakistan (CCP) has completed its Phase-II review of Pakistan Telecommunication…

18 hours ago

Xiaomi’s SU7 Achieves New Production Record, Driving Q3 Growth

Xiaomi has shattered records by producing 100,000 vehicles in just 230 days. This is nearly…

19 hours ago

Teachers Can Now Access OpenAI’s Free AI Course

OpenAI, in collaboration with nonprofit organization Common Sense Media, announced on Wednesday the launch of…

20 hours ago