KARACHI – Authorities in Pakistan continue to tighten the noose around tax evaders and to enforce tax compliance, Federal Board of Revenue (FBR) will now share income tax return data with banks to cross-check against banking information held by financial institutions.
The new provision comes under Tax Laws (Amendment) Bill 2024, which was presented in the National Assembly, bringing trouble for Non-Filers.
The amendment proposed restrictions onthe purchase of new cars, buying and selling immovable properties, trading securities, and restrictions on opening new bank accounts, operating existing accounts, and withdrawing cash from banks.
Under new amendments, the apex tax collection authority FBR will have powers to exchange data with banks, especially for high-risk individuals. Banks will be required to provide FBR with details of individuals whose banking information doesn’t align with the FBR’s algorithms. FBR will share data on income, taxable turnover, wealth statements, and financial statements of individuals and companies.
The amendment further empowers Commissioner Inland Revenue to direct banks and financial institutions to freeze accounts of individuals who fail to register with the sales tax department. These officers can also block the transfer of immovable property for individuals not registered under the Sales Tax Act.
Furthermore, banks will not be permitted to open or maintain accounts for non-Filers, except for Asaan accounts, and withdrawal limits will be imposed as determined by the FBR.
These new regulations are designed to tighten tax compliance and curb tax evasion by ensuring that individuals and businesses can only engage in significant financial transactions if they are in good standing with the tax authorities.
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