FBR and Banks Agree to Share Data to Tackle Tax Evasion
Karachi – In a significant move to combat tax evasion and strengthen financial transparency, the Federal Board of Revenue (FBR) and commercial banks have agreed to implement a data-sharing system. Under this initiative, financial institutions and the FBR will exchange information to monitor large transactions and ensure proper tax compliance.
According to insider sources, investments worth up to Rs. 50 million in mutual funds, money market instruments, securities, and debt-related products will be categorized as “new investments” and tracked accordingly. Additionally, an annual cash withdrawal ceiling of Rs. 100 million per individual has been introduced across all bank accounts. Exceeding this threshold will prompt closer examination from the tax authorities.
The new framework allows the FBR to compare financial records obtained from banks with taxpayers’ declared income and returns using advanced digital analysis tools. If inconsistencies are found, banks will be required to assist in verifying the data and share conclusive results with the FBR. It has been emphasized that the use of this data will be strictly limited to tax-related matters.
Further developments reveal that the FBR may empower Grade 16 officers at the provincial level to supervise and investigate counterfeit goods. This authority can be granted to personnel from either the Revenue Department or the Excise and Taxation Department.
The FBR is also set to take charge of collecting taxes on income generated from digital advertising, including earnings from social media platforms. Failure to submit required tax returns related to online goods, services, or advertisements may lead to penalties. A fine of Rs. 1 million will be imposed on entities that neglect to file the appropriate returns.
In cases where a foreign digital company continues to advertise in Pakistan for more than 120 days without fulfilling its tax obligations, the Income Tax Commissioner will have the authority to halt payments to such companies from local sources.
Overall, this initiative is part of a broader campaign to promote tax transparency and increase government revenue. By monitoring financial activities such as major investments and cash withdrawals, the FBR aims to build a more accountable tax system and discourage undocumented economic behavior.
