ISLAMABAD: Around one-third of Pakistan’s income tax filers — nearly 1.7 million individuals — have declared zero taxable income, highlighting a major concern for the Federal Board of Revenue (FBR) as it pushes to expand the tax base. Out of approximately 5.5 million total returns filed so far, the large number of ‘nil’ declarations has raised red flags within the tax authority.
FBR officials revealed that about 977,000 taxpayers have reported lower income this year compared to the previous fiscal year, prompting the tax body to prepare extensive audit plans aimed at uncovering possible tax evasion. “Certain exporters have even shown losses in their returns. The FBR will issue notices after the October 31 deadline, asking them to revise their declarations or face legal action,” a senior official told The News.
Despite the surge in zero-income filings, officials maintain that valuable data has been gathered through these returns, which will be used to identify unreported income and bring more individuals under the tax net. The FBR has already sent multiple reminders to filers and plans to issue targeted “nudging” messages after the deadline to those showing reduced income.
The tax authority has also hired 2,000 auditors to ensure a more robust audit process this fiscal year. FBR Chairman Rashid Mahmood Langrial confirmed that messages were sent to 853,000 return filers, informing them that the department holds transaction data and other records, advising them to file accurate returns.
“The FBR has extensive data and will act against anyone concealing income,” Langrial said, adding that two warning notices will be issued before any ex parte assessments are made. Officials further noted that those declaring no income despite evident financial activity will face action under tax laws. The filing deadline was extended to October 31, as the FBR anticipates receiving an additional three million returns.
