The Union of Small and Medium Enterprises (Unisame) has launched a scathing critique against the government’s newly imposed cash withdrawal tax, labeling it as “daylight robbery” and an “unfair and irrational burden” on entrepreneurs and ordinary citizens. The strong condemnation comes amidst growing public frustration over the new tax regime on bank transactions.
Unisame President Zulfikar Thaver did not mince words in his appeal to the government. “This tax defies logic,” he declared. “Taxation should be applied on profit, not on one’s own cash savings. Banks already deduct 20% withholding tax on profits — and then taxing cash withdrawal from those same funds? That’s nothing short of double taxation.”
FBR Accused of Disregarding Economic Reality and Stakeholders
Thaver argued that the Federal Board of Revenue (FBR) has “completely missed the mark on equity and justice.” He asserted, “This isn’t just a bad policy; it’s a blatant disregard for economic reality.” Unisame believes the FBR failed to consult with key stakeholders who possess a deep understanding of the day-to-day operational needs of small and micro enterprises.
The union emphasized that small businesses frequently require bulk cash withdrawals to pay vendors, laborers, or address emergency expenses. “Hospitals refuse cheques and credit cards in critical moments — people need cash at hand to survive. Is the government punishing us for being prepared?” Thaver questioned, highlighting the practical necessity of cash in many situations.
Inadequate Withdrawal Limit and Lack of Impact Study
Unisame also pointed out that a cash withdrawal limit of Rs50,000 is “far from sufficient” in Pakistan’s current inflation-driven economy. “It’s barely enough to cover basic business or personal needs. Yet, we’re being taxed for managing our own liquidity,” the organization stated, underscoring the disproportionate impact on small-scale operations.
Furthermore, Unisame raised serious concerns about the lack of consultation with affected parties before implementing this “regressive measure.” “Was there any impact study done? Were the small business voices even heard?” the group questioned, suggesting a top-down approach that ignored ground realities.
Call for Immediate Rollback
Characterizing the cash withdrawal tax as an “anti-business and anti-people move,” Unisame is demanding its immediate rollback. “It’s time the FBR wakes up and stops squeezing the very backbone of the economy — the SMEs,” Thaver warned, emphasizing the critical role of small and medium enterprises in the national economy.
With public outrage mounting, significant pressure is now on policymakers to revisit this punitive tax, which many perceive as a direct assault on personal financial freedom and a hindrance to economic activity.
