FCC sets aside Income Tax Ordinance section enabling taxation on ‘deemed income’ from assets and property

ISLAMABAD: The Federal Constitutional Court (FCC) on Thursday set aside Section 7E of the Income Tax Ordinance (ITO) 2001 as ultra vires the Constitution, which had empowered tax authorities to levy tax on “deemed income” from assets and properties. Having a significant impact on the Federal Board of Revenue’s (FBR) property taxation, Section 7E was introduced through the Finance Act, 2022, for the tax year 2023. It provided for taxation on deemed or notional income arising from ownership of cer...