In order to get full access to accountholders'' data for tax purposes, the Federal Board of Revenue (FBR) has decided that the banks would provide details of tax collected on cash withdrawals exceeding Rs 50,000 from filers and non-filers having accounts where cash withdrawals exceed Rs 1 million or more during each calendar month. In this regard, the FBR has proposed amendment to the Section 165A of the Income Tax Ordinance 2001 through Finance Bill 2018.
According to a tax expert, the section 165A of the Income Tax Ordinance 2001 provides that banking companies are required to provide online access to their central database that contains details of accountholders and their day to day transactions. Such access was so far denied by the banks for reason of secrecy and confidentiality of banking data.
The bill proposes that the banks, instead of giving access to online data, may provide details of tax collected on cash withdrawal exceeding Rs 50,000 from filers and non-filers in respect of such accounts where cash withdrawal exceed Rs 1 million or more during each calendar month. The threshold for providing details of deposit in any account during a month has also been proposed to be enhanced from Rs 1 million to Rs 10 million. Similarly, the threshold of credit card transactions is also proposed to be increased from Rs 100,000 to Rs 200,000 per month, the tax expert added.
According to the proposed amendment in the Income Tax Ordinance 2001 through Finance Bill 2018, in section 165A,-
(a) for clause (a), the following shall be substituted, namely:-
"(a) a list of persons containing particulars of cash withdrawals exceeding fifty thousand rupees in a day and tax deductions thereon for filers and non-filers, aggregating to one million rupees or more during each preceding calendar month.";
(b) in clause (b), for the word "one" the word "ten" shall be substituted;
(c) in clause (c), for the word "one" the word "two" shall be substituted, Finance Bill added.