The Federal Board of Revenue (FBR) has proposed an additional withholding tax on non-filers. The tax rate has drastically increased from 2.5% to 90%.
As per the recent Income Tax General Order, this new tax regime affects over 570,000 identified non-filers. Under the new system, prepaid and postpaid mobile non-filers will face a deduction of 90% of their loaded balance as withholding tax, which the FBR will collect. For instance, if a user loads a balance of 100 rupees, an overwhelming 90 rupees will be allocated to the FBR.
Furthermore, the regulations extend to mobile phone usage. If the SIMs of these non-filers are blocked and they fail to submit their tax returns, any new SIMs acquired will also be subject to a 90% additional tax. This tax will be applied each time non-filers load their mobile and data.
Data on blocked SIMs for non-filers has been shared with the Pakistan Telecommunication Authority (PTA) and telecommunications companies to enforce this measure. As of now, more than 11,500 non-filer SIMs have been blocked. The deadline looms for telecom operators to block the SIMs of over 570,000 non-filers, with just a few days remaining.
Additionally, while over 15,000 non-filers have received warnings about impending SIM blocks, one telecom company has refrained from blocking non-filer SIMs. It has signalled its intention to challenge the Income Tax General Order in court. In contrast, the other three telecom companies have submitted compliance reports to the FBR, which has requested details of the blocked SIMs.
The FBR has set a final deadline of May 15th for blocking all non-filer SIMs, warning that action will be taken against any non-compliant companies. This measure represents a rigorous approach by the FBR to ensure tax compliance and broaden the tax base, directly impacting many mobile users across the country.
