Pakistan’s FBR Rolls Out Tougher Tax Regime for Non-Filers

A sweeping policy update by Pakistan’s Federal Board of Revenue signals increased scrutiny on non-filers. With a goal to close tax loopholes and ramp up collection from previously unaccounted segments, two major changes have been announced affecting everyday financial transactions.

Cash Withdrawal Tax: New Burden on Non-Filers Individuals outside the active tax registry now face a higher advance tax of 0.8% on daily bank withdrawals exceeding Rs 50,000. This is a significant uptick from the previous rate of 0.6%. Banking institutions are officially mandated to apply this deduction automatically, reflecting a nationwide shift toward stricter enforcement.

Revised Property Taxation: Focus on Large Transactions Modifications to Sections 236C and 236K of the Income Tax Ordinance bring new property tax brackets:

• Purchasers:
  • Properties worth up to Rs 50 million: Tax set at 1.5%, previously 3%
  • Properties worth up to Rs 100 million: Reduced to 2%, down from 3.5%
  • Properties above Rs 100 million: Tax trimmed to 2.5%, from 4%
• Sellers and Transferors:
  • A flat increase of 1.5% on advance tax is aimed at more effectively capturing capital gains

The FBR has emphasized that these changes are not only intended to raise revenue but also to bring clarity and fairness to real estate taxation. By simplifying tiers and correcting imbalances, policymakers aim to attract genuine investors while pushing non-filers toward registration.