Business

Budget 2024-25: Govt to ‘increase’ tax on cash withdrawal

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Staff Reporter

ISLAMABAD: The federal government is mulling over increasing an advance tax on cash withdrawal by non-filers from banks in the upcoming FY budget 2024-25.

According to sources, FBR proposed to increase the advance tax on cash withdrawals from 0.6 percent to 0.9 percent for non-filers in next year’s budget.

The government had first imposed a 0.6 percent advance tax on non-filers in the FY2023-24 budget.

Sources said that if parliament approves this tax proposal, the FBR could collect over Rs. 15 billion annually in revenue from non-filers.

Sources also added that FBR has also proposed to increase withholding tax on all sorts of vehicles, having engine capacity of 850cc or more.

Moreover, the govt has also decided to launch a crackdown against individuals who did not register themselves for the Tajir Dost Scheme. The FBR has proposed to send notices to them.

The Tajir Dost Scheme is a voluntary tax compliance scheme designed to simplify tax filing for small businesses.

Expected Tax Rate on Cash Withdrawals

If the proposal is approved, the banks will deduct Rs900 on a cash withdrawal of Rs100,000. The revised tax rate would come into effect from July 1, 2024.

Staff Reporter

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