FBR introduces new tax rules targeting non-filers

The Federal Board of Revenue (FBR) has introduced amendments to the income tax regulations for the fiscal year 2025-26, aimed at expanding the tax base and discouraging non-compliance.

Under the revised rules, non-filers withdrawing Rs50000 or more in a single day from their bank accounts will now be charged a 0.8 percent withholding tax, increased from the earlier 0.6 percent. All banking companies are required to deduct this advance adjustable tax, which can later be adjusted against the taxpayer’s final liability. In the real estate sector, major changes have been made under Sections 236C and 236K of the Income Tax Ordinance. The FBR has reduced the withholding tax rate for property buyers by 1.5 percent across all slabs, while increasing the rate for sellers by 1.5 percent. The move aims to prevent capital gains tax evasion, promote compliance, and make the property taxation process fairer.

The new tax rates for property buyers are now set according to property value:

• For properties up to Rs5 crore, the rate is reduced from 3.0 percent to 1.5 percent.
• For properties up to Rs10 crore, the rate drops from 3.5 percent to 2.0 percent.
• For properties worth more than Rs10 crore, the rate falls from 4.0 percent to 2.5 percent.

On the sellers’ side, the same percentage has been added to each slab, increasing their overall tax rate. According to the FBR, these steps are designed to simplify the tax process, encourage property transactions through formal banking channels, and ensure that both buyers and sellers contribute fairly. With these changes, the government aims to reduce cash dealings, increase documented transactions, and improve overall tax compliance across sectors.