IN my mid-70s, I am one of the ‘elderly’ — those aged over 65 years — who comprise only four per cent of the total population. Maybe that is why we don’t matter to the policymakers, and that is why there is nothing in the recent budget for us. Nothing!
‘Oldies’, like myself, worked, earned salaries, and paid taxes every month. We then invested our post-tax savings in government securities, shares of publicly listed companies, and bank savings accounts to provide an income stream for old age.
Dividend income used to be taxed at 10pc for decades till in the last year of the previous government, it was raised to 15pc — a hike of 50pc in tax on dividend. This continues to date. The income from ‘Behbood Savings’ is meant to be tax-free, but there is a mischief in the tax law, and such exemption is not clearly defined.
We have no other source of income excpet from what we invested from our post-tax savings.
Expenses keep rising, — payment of household salaries, medicine, utility bills, petrol and daily food. Shortfalls in income are met from the sale of shares. Capital gains from sale of shares used to be a tax-free affair till a slab rate was introduced about five years ago.
Life gets increasingly difficult in these ‘twilight’ years. Policymakers say we should all pay taxes like everywhere else in the world, but how?
They conveniently forget that in other countries, the state provides numerous facilities to the aged, such as pensions, quality healthcare, subsidies, etc.
The budget has given various benefits to different categories. Additionally, government servants are given 10pc increase in salaries and pensions. Instead of showing some appreciation for all the taxes we, the elderly, pay, insult is added to injury all the time.
It is time the elderly were given a well-deserved break in the shape of tax exemption on dividends without any ceiling. Capital gains tax should not be applicable to us, and ‘Behbood’ schemes should clearly be defined as tax-exempt.
Sohail Osman Ali
Published in Dawn, June 24th, 2021