Charter of the Economy Table 10.2: Composition of Provincial* Tax Revenues(Revised Estimates – 2020-21) (Rs in Billion) Punjab Share(%) Sindh Share(%) Direct Taxes 32.9 14.5 4.5 2.0 Tax on Income(Agriculture) 2.5 0.6 Property Tax 14.4 3.6 Land Revenue 16.0 0.3 Indirect Taxes 192.1 84.6 218.6 95.0 Sales Tax on Services 121.0 125.0 Stamp Duty 37.0 12.8 Motor Vehicle Tax 12.5 10.3 Maintenance of Infrastructure Fee 6.0 70.5 Others 2.0 0.9 6.9 TOTAL 227.0 100.0 230.0 3.0 *Revenues of Baluchistan and Khyber-Pakhtunkhwa are small Source: Provincial Budgets 10.2. Agenda of Provincial Tax Reforms The development of the agricultural income tax is first focused on. Agricultural Income Tax The agricultural income tax has the potential of being a very progressive income tax Table 10.3: Distribution of Farms by Size in Pakistan Farm Size(Acres)% of Farms% of Farm Area given the extremely skewed Under 1.0 15 1 distribution of farms by size 1.0 to Under 2.5 28 7 in Pakistan, as shown in Table 2.5 to under 5.0 21 11 10.3. However, development of 5.0 to under 12.5 25 28 this tax has been limited by the 12.5 to under 25.0 7 18 potential influence of landlords in the Provincial Legislatures. 25.0 to under 50.0 3 12 50.0 and above 1 22 The extremely high level of TOTAL 100 100 inequality in farm incomes is amply demonstrated by the fact Source: Agricultural Census, 2010. that the top 1 percent of farm owners have as much as 22 percent of the farm area and the top 4 percent own 34 percent of the farm area. 108