Daily Times

The Senate Standing Committee on Finance has approved a proposal to prohibit non-filers from traveling abroad.

The meeting, chaired by Senator Salim Mandviwala, resulted in an important decision impacting individuals who fail to file their tax returns.

According to the Chairman of the Federal Board of Revenue (FBR), actions against non-filers will be enforced under the Income Tax General Order. Exemptions will be made for individuals performing Hajj and Umrah, young children, students, and overseas Pakistanis holding the National Identity Card for Overseas Pakistanis (NICOP).

In addition to the travel ban, the Federal Board of Revenue (FBR) chief has said that electricity and gas connections of the non-filers will be suspended along with SIMs. Tiwana informed the upper house body that non-filers will face suspension of their SIM cards, electricity and gas connections, as well as their businesses could be shut down.

During the session, Pakistan Peoples Party (PPP) Senator Farooq H Naek stressed that the travel restrictions on non-filers should be executed in the same way which were enforced on those who came under the category of exit control list (ECL). Tiwana further said that a higher withholding tax rate was approved for the non-filers. He added that the non-filer list included 500,000 people with over 2 million in annual income. He added that the listed individuals had already disclosed their income statements with their tax return documents in the past. The FBR’s top officer said that temporary filers will also have to pay additional tax during the purchases of vehicles, plots and residences.

Additionally, the Senate body also approved a proposal to reduce the salary slab and hike tax besides, approving the imposition of a 75% withholding tax on cellular and internet bills of non-filers.

Earlier this week, Finance Minister Aurangzeb emphasised the need for widening the tax net, saying that the country cannot run with a 9.5% tax-to-GDP ratio.

“We have to bring everyone into the tax net. We are aiming to bring everyone on the active taxpayers’ list,” said the finance czar. “We have to abolish the non-filer category in the country,” he added. His statement comes hours after he unveiled the federal budget for the fiscal year 2024-25 in the National Assembly, with a total outlay of Rs18.9 trillion.