In a special meeting on Wednesday, provincial government representatives announced that the provinces will not allow the centre to collect tax on agricultural income.
The opposition to collection of tax by the centre came during a special meeting held in Islamabad with Federal Finance Minister in the chair.
The provinces have also not agreed to the federation's suggestion that the tax on agricultural income should be raised to 5% from the present 1.5%.
The purpose of the meeting was to determine the new tax rate for agricultural income.
Senior Advisor Sardar Zulfiqar Khosa represented Punjab while Sindh Finance Minister Murad Ali Shah, K-P Finance Minister Engineer Humayun and Balochistan finance secretary represented their respective provinces.
The provinces have asked the federal government to provide a record of the taxpayers who have declared income from agriculture in their tax returns.
Earlier this week, the Sindh Chamber of Agriculture rejected the proposal of levying new taxes on the agriculture sector.
“The proposed income tax on agriculture will prove to be very harmful for agricultural production as well as the prices of goods in the market,” said the Sindh Chamber of Agriculture’s vice president, Mir Murad Talpur.
He believed the prices of agriculture goods will increase rapidly as a result of the imposition.
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