Online gaming

BUDGET: government will increase taxes on online games and social media apps

The federal government is considering a proposal to raise taxes on income generated through social media platforms, including TikTok, YouTube and other apps, sources said Monday.

According to well-placed sources, the coalition government is considering a proposal to raise income tax on income generated from online games, TikTok, YouTube and other social media platforms.

The authorities are also considering a proposal to raise income tax on earnings of more than 1 million rupees a year, they added.

The development took place under difficult conditions imposed by the International Monetary Fund (IMF) to secure a $1 billion tranche from the international lender.

The sources say that the IMF has imposed strict conditions on the resumption of its program and has asked the Shehbaz government to reduce income tax credits and allowances.

In addition, the federal government is also considering proposals to increase salaries and pensions for government employees and had prepared three proposals to increase the budget for the fiscal year 2022-23.

According to sources at the Ministry of Finance, there is a plan for a 5-15% increase in the salaries of government employees, but it is linked to the prior approval of the International Monetary Fund (IMF).

“The ad hoc allowance for employees of BPS-1 to BPS-19 will be increased by 5-10%,” they said, adding that for BPS-20-22, salaries would be increased by 10-15% .

They further stated that the pension will also be increased by 5-10%. “The Compensation and Pensions Commission has yet to submit its report and the government has ordered them to submit it as soon as possible,” they said.

The government is expected to present the 2022-23 budget on June 12.