With an aim to urge non-filers to pay taxes, the Pakistan Business Council (PBC) has suggested that the Federal Board of Revenue (FBR) implement higher advance taxes on their utility bills, real estate transactions, and luxury expenditures.
The council has put forward the proposal to increase the annual advance income tax amount to 250,000/per year for individuals who are non-filers and own vehicles with an engine capacity of 2000cc or higher.
Furthermore, it recommended an increase in the advance income tax imposed on non-filers [under section 231B] during car purchases, as indicated in the table below. Here are the previous advance tax on vehicles for non filers.
Also, the PBC proposed an increase in the advance income tax from Rs. 1,200,000 to Rs. 2,400,000 on the sale of vehicles with an engine capacity of 2001cc and above by non-filers before registration using their own funds.
The council recommended the collection of advance tax at a rate of 7.5% on domestic utility connections registered under the name of non-filers, provided that their monthly bill amounts to Rs25,000 or more.
Moreover, it suggested the implementation of a withholding tax on withdrawals exceeding Rs50,000 in a single day from the bank accounts of individuals who are not registered as taxpayers.
Besides advance tax, the federal government has also proposed to to increase petrol levy by Rs. 10 per litre on petroleum products taking it to Rs. 60 per litre. Mind you, the current levy rate is Rs. 50 per litre.
Petrol Levy May Reach Rs. 60 Per Litre
The reason behind the move is to generate a non-tax revenue of Rs. 2.9 trillion for next financial year. Meaning, an expected hike in fuel prices for the next fortnight.
As the government is considering to increase expenditure on pension payments and functioning of the civil government by 30% this year. As per the reports, the Finance Ministry has proposed to collect Rs. 870 from this source
Although there is an expectation of crude oil prices reaching $100 per barrel by the end of the year due to Saudi Arabia reducing production by 100,000 barrels per day, the Ministry of Finance has suggested raising rates.
What do you think about the jump likely to observe in advance tax? Drop your thoughts in the comments section.
