The federal government has implemented new tax measures on bank transactions from July 1, affecting both tax filers and non-filers across Pakistan.
Under the revised policy, individuals who regularly file their tax returns will now face a 0.3% withholding tax on cash withdrawals exceeding Rs. 50,000 per day. For those not registered as filers, the rate has been set at 0.6%. These deductions are being applied automatically to all eligible cash withdrawals made through bank branches or ATMs.
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Additionally, non-filers will be charged Rs. 522 on any cheque-based cash withdrawal of Rs. 20,000 or more.
In parallel to the new tax framework, several banking charges have also been increased. The cost of using another bank’s ATM has nearly doubled, rising from Rs. 18 to Rs. 34 per transaction. The fee for issuing or renewing ATM cards has gone up by Rs. 700. Similarly, the charges for SMS alerts have jumped from Rs. 1,200 to Rs. 2,000 annually.
Banks have also revised daily ATM withdrawal limits. Standard debit card holders can now withdraw between Rs. 25,000 and Rs. 50,000, while premium card holders are allowed up to Rs. 500,000 daily. Foreign debit card users can withdraw an amount equivalent to $200–$500 in local currency each day.
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For international ATM use, banks will deduct separate fees, either based on currency exchange rates or fixed charges set by the respective institutions.
Banking executives have reportedly urged 1LINK to review the new charges, fearing a potential decline in digital transactions. However, 1LINK has clarified that it retains only Rs. 7 from each transaction while passing on up to Rs. 28 to the acquiring banks.
