ISLAMABAD: The Council of Islamic Ideology (CII) has ruled that the imposition of withholding tax on banking transactions is incompatible with Islamic principles.
In a press release issued on Wednesday, the council described the practice as “abusive.” The declaration came during a meeting chaired by CII Chairman Maulana Muhammad Raghib Hussain Naeemi.
The council also rejected the proposed amendment to the Diyat law, which aimed to exclude silver, gold, and camels as the standard for blood money compensation. The CII stressed that these Shariah-compliant modes of payment must be retained in accordance with Islamic teachings.
In its recommendations, the council urged the use of halal alternatives for insulin production, avoiding ingredients derived from pork. It also approved the concept of establishing human milk storage banks, but only under strict conditions. The council emphasized that legislation must first be enacted to safeguard against potential misuse.
Meanwhile, the Federal Board of Revenue (FBR) has decided to challenge the CII’s ruling on withholding tax in the Supreme Court of Pakistan.
