Islamabad, June 14, 2025: The Standing Committee on Finance and Revenue on Friday voiced serious doubts over the increase in tax on profit from bank deposits and cash withdrawal taxes.
Chairman Syed Naveed Qamar instructed the Federal Board of Revenue (FBR) to reduce tax deductions on profits earned by small savers. He also suggested that the tax-free limit for cash withdrawals be raised to Rs. 75,000. Calling it economic strangling of local businesses, Qamar urged the FBR to review the decision and provide financial relief to locals.
During the meeting, the Chairman FBR briefed the committee on the Finance Bill recommendations and shared details of the FBR’s Transformation Strategy, which is scheduled to roll out in December 2025.
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He highlighted that Pakistan’s adjusted tax growth (after factoring in inflation and GDP) stood at 1 percent between 2016 and 2018, but declined to -0.3 percent from 2018 to 2024. He also noted that the country’s tax gap has reached around Rs. 7.1 trillion for the 2024–25 fiscal year, and Pakistan remains far behind other nations in terms of tax-to-GDP ratio.
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While outlining ongoing reforms, the FBR chief admitted that proper implementation is still lacking. A dedicated unit has been established to ensure that reforms are carried out with the help of all relevant groups. He presented a timeline that aims to achieve significant improvements by the end of the year.
