MTC Represents Dozens Of Taxpayers In Challenge To Tax On Deemed Income
The Firm is representing a number of taxpayers who have challenged the imposition of Tax on Deemed Income under Section 7E of the Income Tax Ordinance, 2001. Under the aforesaid provisions, the liability for tax falls on any resident individual in Pakistan having more than one immovable property exceeding collective valuation of more than PKR 25 million and whereon no tax has otherwise been paid in the tax year under the 2001 Ordinance.
The key arguments are that the law is violative of the Constitution of Islamic Republic of Pakistan, 1973 because after the 18th Amendment to the Constitution, the Federal Legislature is not empowered to imposed tax on immovable property. Further, the tax has been imposed with retrospective effect which has violated the vested rights of the taxpayers.
We have represented such clients before the High Court of Sindh at Karachi and the matter is currently pending before the Supreme Court of Pakistan. MTC’s team included Arshad Tayebaly, Senior Partner, Omer Memon, Partner, and Aitzaz Manzoor Memon, Senior Associate.