ISLAMABAD - To facilitate the traders from much criticized tax amnesty scheme, the government on Saturday extended the date for filing of tax returns by Individuals and Associations of Persons for the fifth time till 29th February.

Finance Minister Ishaq Dar as Chairman Economic Coordination Committee of the Cabinet (ECC) has also accorded anticipatory approval to amend 0.6% withholding tax rate on banking transactions to 0.3% in respect of non-filers till 29th February 2016. “It may be mentioned that the Income Tax Amendment Act 2016 empowers the Federal Government to amend the rate of 0.6% on the recommendation of the ECC”, said an official handout released by the Ministry of Finance.

Finance Minister gave approval for extending the date for filing of tax returns by Individuals and Associations of Persons till 29th February. In addition the last date for filing of tax returns by traders under the Income Tax (second amendment)/Act, 2016, the last date has also been specified as 29th February 2016.

The decisions have been taken to provide maximum facilitation to taxpayers. The government has given another opportunity to the non-filers to file their returns in the month of February. This is the fifth (5th) extension for filing of returns.

Earlier, the date of filing of returns of total income statement of final taxation which was due on 31 August, 2015, was first extended upto 30th September then extended to 30th October 2015 and then upto 30th November 2015. Later it has been further extended to 31st December 2015 while last extension was granted till January 31, 2016. Present extension would be 5th extension, which would break all records of the FBR when there is issue of granting extension in time for filing of tax returns.

Sources in Federal Board of Revenue (FBR) have informed that government has extended the deadline for taxpayers in general and especially for traders to avail the incentivised scheme commonly knows as amnesty scheme.

The PML-N government on January 1 announced a tax amnesty scheme to whiten the black money up to Rs50 million by paying a nominal 1 percent tax. The government has estimated to generate Rs125 billion through Income Tax (Amendment) Bill, 2016 by bringing 500,000 non-taxpayers into tax net.

For non-filers of income tax returns, the government has agreed to allow the whitening of assets up to Rs50 million. Traders availing themselves of the scheme will be exempted from audit for three years, as they would not be asked about sources of income. The non-filing traders in 2016 will have to declare three times more turnover than the one declared for availing of the scheme.

In case the turnover does not exceeds Rs50 million, the traders will pay 0.2 percent tax and when the turnover is more than Rs50 million but less than Rs250 million, they will pay Rs100,000 plus 0.15 percent of the excess amount. If the turnover exceeds Rs250 million, the traders will pay Rs400,000 plus 0.1 percent.

The income tax filers can also avail the amnesty scheme.

Traders who file income tax returns will be allowed to revise previously filed returns in order to declare the hidden income. They are required to pay a 10 percent higher tax than the tax paid according to the original return.

In case of hidden untaxed income, the filers will declare the income by paying 1 percent income tax.