Tax Rate on Toll Manufacturing

Tax rate on toll manufacturing: Finance Act, 2024 — Explanation regarding Important Amendments made in the Income Tax Ordinance, 2001

Important amendments made in Income Tax Ordinance, 2001 (“the Ordinance”) through Finance Act, 2024 are explained in the subsequent paragraphs.

Tax rate on toll manufacturing

As per section 153 read with sub-clause (b) of clause (1) of Division III of Part III of the First Schedule, every prescribed person making a payment for the sale of goods including toll manufacturing was required to deduct tax at the rate of 5% of the gross amount payable in the case of a company and at the rate of 5.5% in other cases.

The rate of toll manufacturing has now been enhanced to 9% of the gross amount payable in the case of a company and 11% in other cases.

Read full text of Explanation of Finance Act, 2024 Amendments made in the Income Tax Ordinance, 2001 for more updates on taxes from FBR click here.