KARACHI: Tax collection from non-cash banking transactions fell 6.0 percent to Rs4.05 billion during the first five months of the current fiscal year compared with Rs4.38 billion collected in the same period last year, official data showed.
The Federal Board of Revenue (FBR) officials attributed the decline in revenue collection to increase in returns filing.
According to FBR, following persons are liable to file income tax returns:
Where the business income is more than Rs300,000/year;
Income other than business is in excess of Rs400,000/year;
Those owning immovable property of 250 square yards or more or any sized flat in Cantt, Municipal, CT limits;
Companies with financial closing before December 31, 2016;
Those charges to tax in tax years 2015, 2016;
Those owning land over 500 square yards outside Cantt, Municipal, CT limits;
Those having a flat of 2000 square feet area;
Owners of vehicle over 1,000cc, and welfare institutions and non-profit organizations (NPOs).
The withholding tax under the section was imposed only on non-filers while they make non-cash banking transactions. A reduced rate of withholding tax was granted to non-filers at 0.4 percent till June 30.
The reduced rate was, however, withdrawn from July 1 and its normal rate of 0.6 percent was imposed on transactions above Rs50,000/day by a non-filer.
The filing of income tax returns increased to 1.73 million for the tax year 2017, weekly active taxpayers list issued by the FBR on December 10, 2018 suggested.
An official said people making large transactions –mostly traders – are documenting their businesses. A number of traders and other businesses are, however, still out of tax base and opt to operate in cash-based economy.