ISLAMABAD: Prime Minister Shehbaz Sharif has rejected another key revenue measure of the Federal Board of Revenue (FBR) to raise the withholding tax rate from 0.6 to 0.9 percent on cash withdrawals from banks in the budget (2024-25).

The proposed measure is estimated to generate additional revenue of Rs20 billion in 2024-25.

The taxation of pensions was also turned down by the prime minister. So far, the prime minister has already rejected two major budgetary proposals of the FBR to raise the standard rate of sales tax from 18 to 19 percent and impose18 percent sales tax on petroleum products or “carbon tax” on POL products.

Non-filers: FBR proposes WHT raise on cash withdrawal from banks

Sources told Business Recorder that the FBR has proposed one percent increase in sales tax rate from 18 to 19 percent to generate an additional revenue of Rs40-50 billion in 2024-25.

The prime minister has rejected the proposal due to its immediate inflationary impact on the general public.

The second proposal to impose 18 percent sales tax on POL products has also been turned down by the prime minister as it is also inflationary having an immediate impact on the general public.

Copyright Business Recorder, 2024