The Tax Laws (Amendment) Bill, 2024, proposes significant restrictions on various transactions to curb tax evasion and improve compliance. These restrictions will apply to non-compliant individuals and entities under Section 114C(1) of the Income Tax Ordinance, 2001.
Restricted Transactions:
– Vehicle Purchases and Registrations: Non-compliant individuals won’t be allowed to buy or register motor vehicles, except for specific types like rickshaws, motorcycle rickshaws, tractors, and pickup vehicles up to 800CC.
– Property Transactions: Applications for registering or recording immovable property transactions exceeding a certain value will not be accepted from non-compliant individuals.
– Securities Transactions: Restrictions will be imposed on selling or clearing securities transactions for non-compliant individuals or entities.
– Banking Restrictions: Banks won’t be allowed to open or maintain accounts for non-compliant individuals, and there will be limits on cash withdrawals.
Exemptions and Compliance:
– Certain transactions conducted by public companies or non-resident persons will be exempt from these restrictions.
– Non-compliant individuals can rectify their status by filing their income tax return and submitting a source of investment and expenditure statement on the FBR’s web portal.
These proposed restrictions aim to promote tax compliance and reduce tax evasion. However, the effectiveness of these measures will depend on the timely issuance of notifications by the FBR and the level of enforcement across various sectors.
