ISLAMABAD: The federal government on Saturday proposed increasing the cash withdrawal limit for non-filers from Rs50,000 to Rs75,000 per day under the revised budget proposals for the fiscal year 2025-26.
However, withdrawals above this new threshold would be subject to a higher advance tax rate of 0.8%, up from the current 0.6%.
The proposal, which has received approval from the National Assembly’s Finance Committee, is part of a broader effort to tighten tax enforcement and promote documentation of the economy.
Earlier, Finance Minister Muhammad Aurangzeb while presenting the federal budget in the National Assembly had stated that the government also plans to raise the advance tax rate on cash withdrawals to 1%, and phase out the distinction between filers and non-filers.
Under the proposed changes, only individuals who file income tax returns and submit wealth statements would be allowed to make major financial transactions. The measures aim to restrict non-filers from purchasing vehicles or immovable property, investing in securities or mutual funds, and even opening bank accounts.
Digital advertising also under tax net
In addition, the new budget proposes stricter taxation on advertising revenues generated by digital and social media platforms. Meanwhile, high-income earners may receive relief in the form of a 9% reduction in income tax surcharge.
The government believed that these reforms would help boost revenue, curb tax evasion and push more individuals and businesses into the formal tax system.
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