Sindh Hight Court has ruled that Super Tax under Section 4C can be applicable for Tax Year 2022. The court ruled that FBR cannot retrospectively tax income of tax payers for Tax Yar 2022. Section 4C of the Income Tax Ordinance 2001, imposes a super tax on high earning persons
The Petitioners had challenged the constitutionality of Section 4C of the Income Tax Ordinance 2001, and provisions appurtenant thereto, introduced vide Finance Act 2022 on grounds that the same unlawfully vitiates vested rights accrued in past and closed transactions; is discriminatory; confiscatory; demonstrably devoid of any intelligible differentia having rational nexus with the object of classification; and amounts to impermissible double taxation.
Ruling covered many identical petitions filed by aggrieved taxpayer. The Bench headed by Justice Mohammad Junaid Ghaffar ruled that:
- Sections 4C of the Income Tax Ordinance 2001 is read to reflect that the levy shall be applicable from the tax year 2023.
- Notwithstanding the foregoing, the 1 st proviso to Division IIB of Part I of the First Schedule to the Income Tax Ordinance 2001 is declared to be discriminatory, hence, ultra vires to the Constitution.
The court ruled that super tax, as described in section 4C, shall be applicable from the tax year 2023 and not tax year 2022.