SYED WAJIH UL HASSAN 1724

` TAX HISTORY OF SUB-CONTINENT

In the sub-continent, Income Tax was without precedent, presented in 1860 by the British Government
through Income Tax Act 1860 (James Wilson First Finance individual from India) to conquer the money related
challenges after the war of 1857. In the This Act, the very same example was followed as that was winning in
those day in the United Kingdom. The Act was implemented from July 1, 1860 and was proceeded for a time of
five years up to first August 1865. At that point it was pulled back in 1865.

One of the principle highlights is that rural income from land, over the rental estimation of Rs. 690 for every
annum was taxable.

Duty was required on people gaining salary from Rs. 200 to Rs. 500 @ 2% and from Rs. 500 or more @ 4%.

Exception was accessible to people procures salary underneath Rs. 200 including agriculture income. To all
Government properties,

Exception was likewise allowed to development of land whose rental worth is underneath Rs. 600 for every
annum.

Strict & charitable foundations.

Rates was changed every once in a while.

Despite the fact that Income Tax of 1860 was not effectively worked yet the technique concerning duty and
assortment of charges was proceeded under various terminology.

License Tax Act 1867:

Income Tax was not relevant for next two years from that point permit charge was presented “The License Tax
Act of 1867" which was relinquished the following year. Pay earned up to Rs.200 per annum was not available
under this law. Sums earned over this breaking point were available at the pace of 2 percent. In this Act,
horticultural salary was absolved from permit charge under License charge Act 1867 and Act no VI of 1880.

Certificate Act 1868:

Later on in 1868, the license act name was changed to 'The Certificate Act, 1868" and as far as possible was
raised to Rs.500, yet the pace of duty was additionally diminished to 1.6 percent. The demonstration was
surrendered the following year.

General Income Tax Act-II:

In 1869 Certificate Act was changed over in to General Income Tax Act II and agricultural income was again
brought under tax assessment. Yet, this time various paces of expense were proposed on various kinds of
salary. The Act was uphold for just a single year time and in next four years, charge was demanded by yearly
enactment. In 1972 Exemption limit was raised to Rs.1, 000. In 1877 further improvements came-in as License
Act, 1877 wherein charge on exchange and access ashore was proposed. The Act of VI of 1880 and other
nearby Acts proceeded till 1886 to the entire of India.

Income Tax Act 1886:

Income Act 1886 was a significant milestone throughout the entire existence of tax collection from the
Subcontinent. This was the main deliberate assessment enactment in the subcontinent which carried
surprising enhancements to the expense framework. A legitimate meaning of horticultural pay unexpectedly
was made in the Act and complete exception and Concession in installment of assessment was conceded to an
individual paid extra security premium. Personal Tax Act, 1886, itself proceeded up to 1918 and during its life
of 32 years, just one significant correction was made in it in the year 1903.
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There were just four heads of salary;

Income from Salaries and Pensions

Benefit of Companies

Interest on protections

Money From different sources including property pay

After Partition:

Promulgation of Income Tax Act, 1922:

After Independence both the Governments of India and Pakistan in 1947, embraced the Income Tax Act, 1922
as its official personal expense laws. The arrangements of the Act were stretched out to the entire of Pakistan
aside from the uncommon regions.

Formation of the Taxation Inquiry Committee:

In June 1958 special taxation council was shaped to audit the current annual expense framework and submit
proposal to the CBR for changes in current duty laws. The Committee comprises of authorities and agents of
exchange and business. The proposals of the council were acknowledged and personal Tax Act, 1922, was
changed as needs be.

Abolition of Super Tax:

In 1959, Super Tax was abrogated on pay of all people aside from enlisted firms and organizations. The paces
of every piece were communicated as a level of salary.

Change of Fiscal Year:

In 1960 money related year was changed to start on first July and end on 30 June. Already, it used to begin on
first April and end on 31st March.

Income Tax Committee:

In 1961 the Central Board of Revenue (CBR) Introduction Income Tax Committee for improvement of Income
Tax laws 1922 and strategies.

Self-Assessment Scheme:

In 1965 "Self-Assessment conspire was presented. • Before 1965, an appraisal official was evaluated the
income and decided the duty risk of the individual.

Promulgation of the Income Tax Ordinance, 1979:

Somewhere in the range of 1922 and 1979 upwards of 71 alteration acts were passed by the council. Because
of these revisions the Act become a convoluted law and challenges emerged in its working. Keep these
challenges in see, the administration proclaimed another assessment law in particular "Annual Tax Ordinance,
1979" through fund statute June 28, 1979 and incorporated all the essential ideas of the canceled Act, with the
goal that the advantages of the entire case laws worked throughout the most recent 57 years isn't delivered
futile. The Ordinance supplanted the Income Tax Act 1922 and was upheld it viable from first July 1979.

Formation of National Tax Reform Commission:

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In 1985, the Federal Government shaped a National Tax Reform Commission comprise of individuals from
Senate and National Assembly, high government authorities and famous industrialist. In 1985, the
administration set up a National Tax Reforms Commission to recommend available resources to improve the
current duty structure in the nation.

Income tax survey 1999-2000:

Under personal assessment law 1979 the annual expense review was directed in 1999-2000. Motivation
behind the study to basically survey winning tax assessment structure and submit proposals to patch up the
tax collection framework in as per the worldwide principles.

Introduction of Tax Amnesty Scheme:

Many tax amnesty schemes were introduced under the Income Tax Ordinance, 1979. These schemes were
introduced to provide a chance to black money holders, so that they can change their black money into white
money. Latest scheme was introduced in the year 2002.

Promulgation of income tax ordinance, 2001:

Following 22 years of the declaration of the Income Tax Ordinance, 2001, there was nonstop analysis from the
major unfamiliar contributors IMF and world Bank that the current Income Tax laws of the nation isn't lined up
with the global norms the Government of Pakistan on the transcription of IMF presented another annual duty
law to be specific, "The Income Tax Ordinance, 2001" as a precondition of the advance program with IMF. The
Ordinance was declared on September 13, 2001 by the Government of General Pervez Musharraf. It was
distributed in the Extraordinary Gazette of Pakistan at pages bearing Nos. 969 to 1217. The Income Tax
Ordinance, 2001: to abrogates different laws enforceable in Pakistan.

Income Tax Rules 2002:

The FBR under the authority of area 237 of the Income Tax Ordinance, 2001 made the Income Tax rules, 2002.
These guidelines were distributed on July 1, 2002 in Extraordinary Gazette of Pakistan at pages 1819 to 1966.

The new Income Tax Ordinance which was composed by an Australian Law expert and Assistant Professor Mr.
Lee Burns there have been so numerous analysis from various quarters of Government, lawful and proficient
specialists, court of laws including the Supreme Court of Pakistan for the helpless drafting and typographical
mistakes, irregularities and calculated misrepresentations and inconsistencies polarities. In excess of 2000
alterations so far have been made since initiation.