Non-filers can now withdraw upto Rs75,000 from ATM without Tax deduction, says FBR

ISLAMABAD: The federal government has raised the cash withdrawal limit for non-filers from Rs50,000 to Rs75,000 before applying the withholding tax. The move aims to expand tax coverage while correcting a budget misstatement.

In a key update to the Finance Bill 2025–26, the government raised the withholding tax threshold on cash withdrawals for non-filers from Rs50,000 to Rs75,000. FBR Chairman Rashid Mahmood Langrial confirmed the change during a review session with the National Assembly Standing Committee on Finance at Parliament House.

Langrial also clarified that the withholding tax rate is 0.8%, not 1% as mistakenly announced in the budget speech. He explained that the new Rs75,000 limit aims to widen the net of non-filers while making compliance easier for those making smaller cash withdrawals.

Govt settles on Rs75,000 withdrawal cap after Rs100,000 suggestion:

Committee Chairman Naveed Qamar initially proposed raising the limit to Rs100,000, but the FBR and the committee ultimately agreed to set it at Rs75,000. They aimed to strike a balance between effective tax enforcement and public convenience with the revised limit.

The government included the withholding tax on cash withdrawals for non-filers as part of its broader plan to boost revenue collection. Officials also discussed additional proposals involving technical adjustments to banking sector taxation to better align with the State Bank of Pakistan (SBP) regulations. These changes aim to enhance income reporting through more disclosure-oriented provisions.

Additionally, the FBR proposed slightly reducing the super tax rate for entities earning between Rs200 million and Rs500 million. The move aims to ease the tax burden on compliant sectors and support economic activity.