Pakistan‘s Federal Board of Revenue (FBR) is working on a system to get live data on all bank transactions in real time. The plan should help the agency bring in more taxes by revealing any potential tax evasion schemes.
Khan orders collection of live data on all bank transactions
Pakistani Prime Minister Imran Khan ordered the State Bank of Pakistan and the Ministry of Law and Justice to amend banking laws to allow for the FBR to collect live data on all bank transactions. The amendments will go into effect at the beginning of 2020.
According to ProPakistani, laws requiring banks to provide the FBR with data on all transactions have already been in place, but banks have cited a variety of excuses to avoid complying with them. For example, the Finance Act 2013 added requirements for banks to share information to the Income Tax Ordinance 2001.
Einhorn Tells Investors: Tesla Is Gaming S&P 500 Index Committee
The Federal Reserve has poured unprecedented levels of stimulus into the U.S. economy to deal with the pandemic, and most experts agree that inflation is just around the corner. David Einhorn has positioned his Greenlight Capital to benefit from inflation when it arrives. Q2 2020 hedge fund letters, conferences and more SORRY! This content is Read More
Banks are supposed to provide information about accountholders to tax officials. They are also supposed to provide officials with a list of those who with draw at least Rs 50,000 per day or Rs 1 million per month. They are also ordered to give officials a list of those who deposit Rs 10 million month, make a credit card payment amounting to Rs 250,000 per month, or receive profit on a debt over Rs 500,000 per year.
However, despite these laws and regulations, banks in Pakistan usually do not provide the required information to tax authorities. FBR officials say that because banks aren’t providing this information, the black-market economy is flourishing, and many people are going untaxed. They hope having access to live data on all bank transactions will enable them to correct these problems.
According to the State Bank of Pakistan, as of the end of June, there were 54.7 million bank accounts in Pakistan, of which 7.6 million still haven’t been verified because appropriate details have not been provided. Authorities with the SBP say this presents a threat to the nation’s economy.