Non-filers have been barred from purchasing cars and houses as the government announced budget 2018-19.
Any property that has a declared value of above Rs 4 million cannot be purchased by non-filers. Also, non-filers can also not purchase any new motor vehicle if their name is not featured in the active taxpayers’ list (ATL) of the Federal Board of Revenue (FBR).
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Finance Bill for 2018 states, “Non-filers shall not be permitted to purchase new motor vehicles manufactured in Pakistan or new imported vehicles.”
If the National Assembly passes the bill, it will be effective from 1st July.
It is compulsory on all Pakistanis whose taxable income exceeds Rs400,000 to file for income tax return every year. Through this process, the government keeps an eye on revenue collection, wealth accumulation, and checks whether tax submitted is in line with annual earnings.
But, only 1.26 million tax returns were filed in Pakistan while the total population of Pakistan is of 207.7 million. Thus in order to penalize the non-filers, the government has decided to take neccassary steps which will ensure that they file the tax return, this year.
The non-filers have been banned from buying new vehicles. This will also have an affect on auto industry of Pakistan as well.
An industry official said, “It will jeopardise all our efforts to counter the menace of premium, as the decision will motivate investors to buy cars and sell to non-filers on a hefty premium.”
As per an auto official, “This will increase the government’s revenue as well. We are hopeful that government will consult stakeholders before the step is implemented. It directly affects one of the biggest industries in Pakistan.”
This new bill is proposed at a time when Pakistan’s auto sector is witnessing immense growth. It sales units have reached 192,734 in last 9 months, which is a 22% year on year increase.
Now the budget can affect auto industry, but the government is quite determined on its decision.
FBR’s Member Inland Revenue-Policy and spokesman Dr. Muhammad Iqbal said, “Those on the ATL will be able to buy cars. It will be the responsibility of the companies to see if their customers feature on the list.”