The Federal Board of Revenue (FBR) eyes positive productive outcome of the tax amnesty scheme on account of repatriation of assets of Pakistanis from abroad. Due procedure for the repatriation of funds from abroad will result in the accumulative tax revenue on the bank transactions. Transfer of funds through proper banking channels will enhance tax collection by the FBR.
All remittances less than $100,000 per year per person will continue without any questions from any agency about the source of funds and enjoy tax exemption; all remittances greater than that amount will enjoy tax exemption but may be scrutinized by the FBR.
On the 5th of this month, Prime Minister Shahid Khaqan Abbasi introduced the tax amnesty scheme through which the people with undeclared income earned before June 30, 2017 would be legalized by simply paying a five percent penalty.
A source of special advisor on revenue told Customs Today that repatriation of at least five or six billion dollar from Pakistanis holding billions of dollars abroad was expected. This repatriation of funds is because of changed and almost tightened financial security measures across the globe. These measures have made it difficult for Pakistanis to hold funds abroad without clear cut justification.
The source said that the repatriation of amount of expected funds would play immense role in the economic revival of the country by increasing tune of country’s forex reserves as well as to bridge trade deficit and current account deficit.
“Pakistan received an extended funds facility (EFF) from the International Monetary Fund (IMF) worth $ 6.25 billion some four years back; therefore, addition of five to six billion dollars to national economy will make a lot of difference for the smooth functioning of economy” the source added. Thus, the source said that tax amnesty scheme would play key role in the productive role in the economic uplift by repatriating funds from the abroad.