Here’s how much advance tax non-filers will pay on cash withdrawal

KARACHI: The federal government has imposed 0.6 percent advance tax on cash withdrawal for non-filers to bring more people into the tax net.

The top tax authority has issued a circular in this regard, stating that non-filers will pay Rs303 in wake of tax for a bank withdrawal of Rs50,500. Those withdrawing between Rs55,000-Rs75,000 will be charged Rs450.

For removal of doubt, it has clarified that the said Rs50,000 shall be aggregate cash withdrawal in a single day.

The circular states that the “withholding tax rates have been increased from 1% to 5% for ATL persons and from 2% to 10% for non-ATL persons.”

This advance tax has been imposed on the recommendation of Reform and Revenue Mobilisation Commission (RRMC) led by Ashfaq Tola. RRMC recommended that withholding tax on cash withdrawal, other banking instruments and banking transactions to be restored for non-filers of tax returns.