The federal cabinet has abolished income tax on the profits made on loans given to foreign banks.
Foreign banks have been making a profit on ڈالر 3 billion in loans to Pakistan over the past year. The loans were obtained by the government to keep foreign exchange reserves in double digits. The Federal Minister for Science and Technology has confirmed to the Express Tribune that the Cabinet has (Thursday) approved a summary of the abolition of income tax on foreign loans. Of the 3. 3.04 billion in loans, 2 2 billion came from China. In the last two months, the federal cabinet has exempted foreign loans worth Rs 5.5 billion from taxes.
These include 2.5 2.5 billion in Eurobonds obtained at relatively high-interest rates. Credit Suisse AG (11 115 million), Islamic Bank of Dubai (4. 4.5 million), China Development Bank (1 1 billion), and other banks that have been exempted from income tax by taking interest on loans obtained from foreign banks. Of China (ڈالر 500 million), Industrial and Commercial Bank of China (کروڑ 500 million), Emirates NBD (37 370 million), Ajman Bank (11 110 million) and ECO Trade and Development Bank (4 40 million). ۔
The decision of the federal cabinet will directly benefit the banks which are already profiting from high-interest rates. According to official documents, the finance ministry informed the federal cabinet that foreign banks had given commercial loans on the condition that Pakistan Taxes levied will not apply to creditors.
