The Punjab government has announced a significant increase in taxes on agricultural income as part of its budgetary measures for the new fiscal year. The government has set a tax revenue target of Rs 10.5 billion from agricultural income, marking a sharp rise of 200% compared to the previous fiscal year’s collection.
According to the budget documents, the new tax framework extends corporate tax rules to commercial farms operating on a business or trading basis in Punjab. This means that large-scale commercial agricultural enterprises will now be taxed like corporate entities. Moreover, a super tax has been imposed on individuals earning higher incomes from agricultural activities.
The government has also introduced stricter penalties and default surcharges to enforce compliance. Taxpayers who fail to file returns or pay their taxes on time will face increased fines. These changes have been enacted under the Agricultural Income Tax (Amendment) Act of 2024, which aims to broaden the tax base within the agricultural sector.
This move is part of Punjab’s broader efforts to increase non-traditional revenue sources and improve tax compliance. Given agriculture’s central role in the province’s economy, the government expects these changes to generate substantial additional revenue to support public services and development projects.