Fact-Check: Have agricultural taxes been hiked in Punjab?

It is being claimed in various social media posts that the caretaker government in Punjab has made substantial changes to the collection of tax from agricultural lands in the province, in a bid to increase tax revenues in the country.

Now, a farmer earning more than Rs400,000 per year, from over five acres of cultivated land, will have to pay an income tax, some online posts alleged, adding that earlier owners only had to pay a flat rate on the land.

The claim is false.

Claim

On September 16, an X user posted the screenshot of a letter purportedly from the office of the additional deputy commissioner revenue in Khanewal, Punjab, to all assistant commissioners.

“It is to inform you that the learned member of the taxes Board of Revenue has directed to invite your attention to a highly important matter,” the letter read, adding that all the assistant commissioners must ensure that farmers with agricultural income over Rs400,000 must file tax returns.

“How cruel can you be?” an X user wrote sharing the letter, “For a farmer or cultivator, who is earning more than Rs400,000 per annum by cultivating more than five acres of land, it is now mandatory to file agriculture return.”

Another X user wrote: “An achievement of the caretaker government in Punjab. Now those who earn an income over Rs400,000 per annum on land measuring more than five acres are required to submit agriculture returns. Otherwise the Assistant Commissioner will assess the income and levy a tax.”

Similar posts were also shared here and here.

Fact

There has been no change in the tax slabs for the agricultural sector in Punjab. Neither have any new taxes been rolled out for farmers.

Tariq Qureshi, the member taxes at the Board of Revenue (BOR) in Punjab, which collects agricultural taxes, told Geo Fact Check at his office that in 1997, after the Punjab Agricultural Income Tax Act became law, a fixed land-based tax was levied on farmers.

Land-based tax is assessed on the basis of a sown area during the agricultural year.

But Qureshi explained that in 2001 it was decided to also tax the annual income of a farmer. The law defines agricultural income as any rent of revenue derived from land used for agricultural purposes.

“Since 2001, both the land-based tax and income tax [of a farmer] is compared,” Qureshi said, “Whichever of the two is higher is then collected from the person.”

He added that no new changes have been made to the laws or the tax regime for the agricultural sector.

Mazhar Hussain, the public relations officer at the senior member Board of Revenue, also confirmed the same.

He added that the additional deputy commissioner in Khanewal sent out the letter as an instruction to revenue officials to guarantee that tax is collected before the deadline, adding that no changes have been made to the tax law or the rules recently.

Sharjeel Hafeez Wattoo, the additional deputy commissioner revenue in Layyah, Punjab, also told Geo Fact Check over the phone that BOR had been collecting income tax from farmers for several years and it was not new.

How much tax do farmers pay on agricultural lands?

Land-based taxes

The table above shows the fixed taxes farmers pay on a sown area during the agricultural year. (Data provided by Board of Revenue)

Tax on Agricultural Income

The above table shows the taxes farmers pay on their income during the agricultural year. (Data provided by Board of Revenue)

With additional reporting by Nadia Khalid.

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