Karachi: The State Bank of Pakistan (SBP) has directed all banks to align their operations in accordance with the tax amnesty scheme in a letter, a news source reported.
The SBP issued this notification to the President and CEOs of all the banks. In the notification, the central bank has said that the Asset Declaration Ordinance 2019, which forms the legal basis for the amnesty scheme, has been promulgated with the aim to offer an opportunity for voluntary declaration of undisclosed assets, sales and expenditures. The purpose of the scheme is to allow the non-documented economy’s inclusion in the taxation system. Encouraging a tax-compliant system will result in economic revival and growth.
Under Section 8 of the Asset Declaration Ordinance 2019, any such declaration will be valid if the foreign currency held in Pakistan declared under Section 3 is deposited into the declarant’s own foreign currency bank account at the time of declaration. It also has to be retained in such account till June 30, 2019.
SBP further clarified that notwithstanding any instructions to the contrary contained in the Foreign Exchange Manual, any declarant, including non-filers, can deposit foreign currency in cash into one’s bank account under the ordinance. Similarly, the provision of Foreign Exchange Manual, Chapter 6, para 1(vi) regarding deposit of foreign currency notes in foreign currency accounts exceeding USD 10,000 (or equivalent in other currencies) in a single day, will not be applicable to such deposits made under the asset declaration scheme.
However, the banks have been instructed to obtain a copy of the declaration filed with the Federal Board of Revenue (FBR) by the declarant when accepting such deposits. They will accept such deposits only if the amount being deposited is equal to the amount declared in the declaration filed with the FBR.
The banks will also ensure the confidentiality and secrecy of the information contained in the declaration submitted to them by declarants along with the deposit request. They are also required to submit the same to the State Bank of Pakistan (SBP) within seven days of the closure of the scheme.