The withholding tax rate was raised to 15% for filers and 30% for non-filers when deposit returns were as high as 21%. Now that inflation and policy rates have dropped to 8% and 15%, respectively, and profit returns on deposits have decreased significantly, maintaining these high withholding tax rates is unjustified.
The Federal Board of Revenue should review this policy and restore withholding tax rates to their original levels of 5% for filers and 15% for non-filers. This adjustment would prevent undue hardship for depositors, particularly low-paid employees and pensioners, who are already struggling.
M. SHARAFAT ALI ZIA,
Islamabad.