Government Plans to 'Raise' Tax on Cash Withdrawal in Upcoming Budget
The federal government is contemplating a rise in the advance tax on cash withdrawals made by non-filers from banks in the upcoming fiscal year’s budget for 2024-25, as reported by ABC News citing sources on Wednesday.
Sources indicate that the Federal Board of Revenue (FBR) has suggested increasing the advance tax on cash withdrawals from 0.6 percent to 0.9 percent for non-filers in the next budget.
Initially introduced in the FY2023-24 budget, the government imposed a 0.6 percent advance tax on cash withdrawals by non-filers.
If approved by parliament, this tax proposal could result in the FBR collecting over Rs. 15 billion annually in revenue from non-filers.
Additionally, the FBR has proposed raising withholding tax on vehicles with engine capacities of 850cc or more.
Furthermore, the government plans to launch a crackdown on individuals who have not registered for the Tajir Dost Scheme, a voluntary tax compliance initiative aimed at simplifying tax filing for small businesses.
These proposals have been presented to the International Monetary Fund (IMF), with further approval pending from Prime Minister Shahbaz Sharif.
In related developments, the IMF has demanded a further increase in electricity prices, foreseeing an additional burden of Rs 150 billion on the power sector.
