ISLAMABAD: The Federal Board of Revenue (FBR) will now share income tax returns data with banks to compare it with banking information available with them under the new provision introduced under the Tax Laws (Amendment) Bill 2024.
According to the Tax Laws (Amendment) Bill 2024 introduced in National Assembly on Wednesday, the FBR has introduced concept of “eligible” and “ineligible persons” and imposed restrictions on economic transactions of ineligible persons (non-filers) including purchase of motor vehicles, buying/selling of immovable properties, sale of securities and ban on opening of new bank accounts or operating existing accounts and withdrawal of cash from banks.
According to the Tax Laws (Amendment) Bill 2024 introduced in National Assembly on Wednesday, the exchange of banking and tax information related to high-risk persons has been allowed between banks and FBR.
Tax year 2024: FBR receives 4.436m income tax returns
The Board may share information of turnover, income including taxable income, for one or more tax years, identification data including bank account numbers declared in the income tax return, wealth statement, financial statements of persons along with data-based algorithms with scheduled banks in Pakistan.
The banks shall provide to the Board particulars, Such as name, account numbers of such persons where the banking information at variance with the data algorithms provided by the FBR.
Under the Tax Laws (Amendment) Bill 2024, the “eligible person” shall mean a person, who has filed a return of income for the tax year immediately preceding the year of transaction mentioned and has sufficient resources in the wealth statement in case of an individual, or financial statement in case of a company or an association of persons, as the case may be, for such transaction.
On the other hand, “ineligible person” shall mean a person who is not an eligible person.
The Commissioner Inland Revenue shall have the powers to direct banking companies, scheduled banks and other financial institutions to bar operation of the bank account of any person who fails to get registered with the sales tax department for the purposes of Sales Tax Act.
The Commissioner shall also have the powers to direct the Property registering authority to bar transfer of immoveable property of any person who fails to get registered for the Purposes of Sales Tax Act.
Any person who fails to get himself registered for the Purposes of this Act, the Chief Commissioner shall have the powers to seal the business premises; seize moveable property; or appoint a receiver for the management of the taxable activity of a person.
Under the Bill, there would be restriction on economic transactions by certain persons.
It included any application, by any ineligible person, for booking, purchase or registration of a motor vehicle, shall not be accepted or processed by any manufacturer of a motor Vehicle or vehicle registering authority of Excise and taxation Department, as the case may be.
There would be restriction on any application or request by any ineligible person, to any authority responsible for registering, recording or attesting transfer of any immovable property, more than such value in aggregate in a tax year as may be notified by the Board from time to time, shall not be accepted or processed by such authority.
There would be restriction on economic transactions including any person, authorized to sell securities including debt Securities or units of mutual funds including a person authorized to open and maintain an account or clear such Transactions, shall not sell, open an account or clear sale of securities, mutual funds, to an ineligible person being an Individual or an association of person.
A banking company shall not open or maintain an already opened current or a saving bank or investor portfolio securities account, except Asaan account, in the name of such persons as may be notified by the Board.
The banks will not allow cash withdrawal from any of the bank accounts of any person, exceeding the amount as may be notified by the Board from time to time.
The provisions of sub-section (l ) shall not apply to purchase of rikshaws or motorcycle rikshaws or tractors; purchase of a pick up vehicle having engine capacity up to 8OO CC and purchase of such motor vehicles other than those mentioned.
There would be restriction on economic transactions including investment in securities up to such limit as may be notified by the Board from time to time.
Copyright Business Recorder, 2024
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