FBR Imposes New Tax on Real-Time Interbank Transfers

According to Federal Board of Revenue (FBR), Interbank funds transfers or Pakistan Real-time Interbank Settlement Mechanism (PRISM) transactions will now be charged a new withholding tax under section 236P of the Income Tax Ordinance 2001.

When asked, Shahid Hussain Asad, Senior Member FBR (Inland Revenue Policy) and Official Spokesperson FBR, said that all PRISM transactions conducted at banks are now subjected to withholding tax. He said the tax will come under Section 236P of the Income Tax Ordinance 2001. The government has already passed the amendment through the Income Tax Amendment Ordinance 2015.

The transactions will be taxed at a relatively reduced rate of 0.3 percent. The amount was previously stated to be 0.6 percent in July but the trade community held a protest which led to this reduction. The protesting community has been given an extension of 1 week (till 7th November) to file their income tax returns under the new ordinance.

The section 236P has been recently introduced in the Financial Act 2015 which requires all banking companies to deduct withholding tax from non-filers at the time of sale or any financial transaction. The tax also applies to “demand drafts, pay orders, special deposit receipts, cash deposit receipts, short term deposit receipts, call deposit receipts, rupee travellers cheques or any other instruments of such nature”.

The tax is also applicable at “the time of transfer of any sum through cheque, interbank or intra bank transfers through cheques, online transfers, telegraphic transfers, mail transfers, direct debits, payments through internet, payments through mobile phones (easypasia etc.), account to account funds transfer, third party account to account funds transfers, real time account to account funds transfer, real time third party account to account fund transfer, automated teller machine (ATM) transfers, or any other mode of electronic or paper based funds transfer.”

via Business Recorder

He is the Editor-in-Chief at ProPakistani. Reach out at aadil.s[at]propakistani.pk

  • I think its RTGS which will be charged now. Previously it was free from withholding tax and was commonly availed by corporates for interbank fund transfers to avoid tax. Banks don’t offer this facility to common people.

    • Actually, RTGS transactions were being charged at 0.3% since 1st July 2015. For people who didn’t file their returns which is a very small percentage of people who actually need RTGS as a transfer method.

  • Ishaq Dar is the biggest bloodsucking leech in the history of insects that ever walked on earth. He is the parasite that lives by sucking Pakistani blood.. The biggest fcuk of this country, Ishaq Dar, I wish I could tax you to death!

    • Swearing at him just because he made it difficult to avoid taxes? Sir, you should be appreciating him regardless of your political affiliations. Their voters are biggest victims of their tax regime yet they are doing it. We dont pay taxes, and get bad law n order situation and then complain.

      • Really? So how about increase tax bracket and bringing in agriculture tax? How about tax paid by your dear sharif’s? Just try and think how much is their income and how much they actually pay? No idea? Ok just think of raiwand residence and just imagine how much money will be required to maintain it and where it comes from? They’re are on squeezing more and more of people who are already paying heavy taxes and getting nothing in return. What do you think taxes do? They get you better quality of life through education, healthcare, security, infrastructure etc and we have none of that. Think twice before you comment, as otherwise you will look dumb.

      • I am sorry if the swearing hurt you. I didn’t intend to hurt anyone except Ishaq Dar :)

        Brother, when someone leeches on you without any reasonable explanation and it targets you specifically, obscenities fly out of the mouth.

        Each and every penny of our hard-earned, blood-supplicated and toil-driven money is being taken by the Government for building useless bridges and filling their pockets while traveling the world just to show their chubby, fool-looking face to the world.

        I will happily give taxes if the Passport of Pakistan is respected all over the world, general amenities are provided to everyone. What would you say when you have to pay taxes for the gas connection and bribe them to bring it to you home.!!!!!

        Thank you for correcting me. I will never swear at anyone except Ishaq Dar and the biggest fcuk of the entire human population that existed on this earth – Moulana Diesel..

        By the way, I am not a supporter of Imran Khan. I support Islam :)

      • Regarding taxes, I think pakistanis are already paying huge taxes and in return not getting required services from goverment. Just take one thing for example, 100 rs card deduct around 12% withholding tax, 16% sales tax, 16% tax per minute call, you already paid tax on your phone(when purchased). Other countries tax their citizens but in.return provide excellent services…

      • This is a short cut, doesnt take into account the many old age people who will suffer unnecessarily. Look at it from any way and it is clearly the mentality of a Quick fix vs a long term, viable , effective measure. Draconian Collective punishmet

  • This is what happens when only 1% of total population pays tax. TBH, this “tax-chor-awam” deserves leeches like PMLN.

    • This is what happens when only 1% of total population pays tax and Govt. can’t impose its law and don’t want to pursue real tax evaders (remember the list of 35 lac tax evaders by Tariq Malik of NADRA?) and instead is looking for lame excuses to increase its tax collection figures (to please IMF and run their expenses) using insane indirect taxes. (Once again small businesses getting effected while big fishes don’t even care)

      Does any one seriously think this will increase number of tax filers dramatically? I think only by a small margin.

    • Sir, with all due respect, instead of repeating what the politicians speak to sell their policies, why not talk about corruption and unaccountability?

      If corruption from this country was eradicated, along with de-politicization of national institutions such as LEAs, 99% of the issues of the country would be solved automatically.

      tax-chor awam is due to tax-chor hukumraan. And awaam doesn’t have confidence that their money will return back to them, and not be spent on nihari and foreign trips. Would the awaam have faith over politicians, and should they see money being spent on their well being, they’d automatically start paying tax.

      People of Pakistan will not pay taxes in this way. The Tax net wouldn’t increase, only the ones bearing the burden will be burdened further. Do you know, 40%+ Tax Payers don’t link their mobile phones, etc and never claim back WHT (or indirect taxes)?

      The best way was to prove that their money would be spent for their well being and then people would automatically trust their government. The other way was increasing penalties. Not killing the poor. Actually it is a failure of the government and these figures prove that there’s a lack of trust between the voters and the government they elected. They don’t trust them!

      The real power of the government isn’t getting elected, and a good vote bank. It’s the trust of people which can be seen by the awam not paying taxes.

      Hypothetically, if awam is tax-chor and 99% don’t pay taxes, means the politicians we have are only loved, trusted and elected by 1% of the awaam.

      Had my leader, father, or Quaid e Azam asked me to give my lifetime of savings, I wouldn’t give a second thought, just like the Habib Group did at the time Pakistan was born.


        • Don’t ever feel like answering stupid people, but according to your theory the would should never change.

          Englishmen changed over the past 100 years, due to their leaders.

          Just check beyond the borders. Indians and Chinese. The people didn’t change until the leadership changed them. Acknowledging your theory means we’ll be the same next 500 years. Well, Best of Luck Pakistan, and Pakistani’s like you! Who will never curse the government, yet just give such excuses.

          • I proudly support a man with a cause; Imran Khan. I do believe a leader can bring reforms in society but this Awam elected same old thugs again and again like PMLN and PPP. What did these 2 parties deliver to this country except corruption?
            Even Hazrat Ali (as) said; “To test a tested one is stupidity.”

    • I agree but what about thise who are already paying taxes. They should be exempted from any kind of wht bull crap.

      • You can get rebates. If you’re a salaried person and pay income tax, then other taxes (Mobile, Utility, etc that are registered in your name) are included in the rebate. As for WHT, you are exempt from if except on cash withdrawals which is at 0.3%.

    • grow up, use your brain…100% population of Pakistan pays over 19% tax on each and everything from water to car. Is this not a Tax in your dictionary? I wont never ever pay even a single penny in tax unless govt reduces he indirect tax to single digit as we see in other civilized countries…that’s why their people pay direct taxes because indirect taxes are under sane levels…..so dont be stupid to call yourselves “Tax Chor”we all are tax payers….

    • Going to say it again as many people have been saying along it. It’s the current government fault for not doing jack other then squeezing the already burdened middle class. Why doesn’t PMLN and other crooks tax the elite? Why aren’t the elite Pakistani family getting tax? Why so much hate on someone who just earn 1 lac pkr a month, what about those politicians and elite business owners who make million or even billion a month? Why not tax those 5 percent Pakistani who own 75 percent of the arable land of Pakistan? Why should the 55 percent rural population who don’t even own land pay a dime tax? The only people who should be paying and should be prosecuted are the people who voted for this absolute mentally retarded government.
      Publicizing government institutions, tax reform, taxing the elite, land reform, putting qualified professionals in charge of important sector of the economy like finance should be the way like Imran Khan said. Not the bloody ministers handling what should be made and what shouldn’t. Their damn job is to discuss policy making and should ne meddle with commercial projects! That’s planning commission duty! Where the hell is planning commission duty? Oh yeah, PML-N shut it down.

  • But not for those who are submitting there tax return. It’s only for those who are not submitting tax return. We have to accept with out tax we can not be a prosperous country. So no harm in submission of tax returns.

    • bhai sahab seems you have no idea of these thing only repeat words of dolaar minister.
      If i send remittance to pakistan, why it needs return to be filed. my money already a tax free money. so please know first to comment.

      moreover, this WHT has already been in place since day one. they have been charging it and I paid many times above 50000pkr only now it is official.

      • By law, you are required to file tax returns even if 0 Rs of tax applies to you.. filing returns does not mean you have to pay tax on something that you are not supposed.. Just do your civi duty and ask others to do it as well.

    • Submitting Tax Return is Hell. Paise kamana asan ha, Cheezien kharidna asan ha. Lakin Tax Return file karna (in Pakistan FBR System) ek azab ha shyd kabar k azab se bhi zada ha :P

    • Return filers are exempted. This new tax is for RTGS transactions, which were exempted before. But then again, mostly large traders who are generally filers use this type of transactions, so doesnt matter.

  • We have a tax related discussion on Whats app .Please taxt your cell number with name at 03336346404

  • In my account statement it show “Charges taxes plus FED”.I want to know if there is any withholding tax amount in it?

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