Govt proposes 0.6% tax on bank transactions above Rs50,000 for non-filers

The federal government has proposed a .6 percent withholding tax for non-filers on each bank transaction of above Rs50,000 in the budget 2023-24, reported the 24NewsHD TV channel.    

According to the documents, the government has decided to raise the tax collection target to Rs 9,200 billion for the next fiscal year 2023-23.

After the imposition of a .6 percent withholding tax for non-filers on each bank transaction of above Rs 50,000 stands that non-filers will have to pay Rs 300 for every transaction above Rs 50,000 up to Rs 99,999.  The PDM-led coalition has also decided to set the non-tax revenue target as Rs 2,800 billion.

All banks are obliged for withholding tax on Cash Withdrawal through single or multiple transactions on all accounts, given that the payment for cash withdrawal, or the sum total of the payments (including withdrawal from ATM in a day) for cash withdrawal in a day from all bank accounts of a ‘Non-filer” customer exceeds Rs.50,000.

This tax shall be charged at the existing rate of 0.6%.

Regarding advance tax on transactions in Bank, 0.6% withholding tax shall be charged for ‘non-filers’ on sale against cash of any banking instrument including demand draft, pay order, CDR, STDR, SDR, RTC, or any other instrument of bearer nature.

In addition to this, withholding tax on the same rate shall be charged for ‘non-filers’ on the transfer of cash through any mode of electronic transfer.

However, there shall be no withholding tax on customers having ‘filer’ status.