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Sunday, October 06, 2024  
02 Rabi Al-Akhar 1446  

Govt planning mini budget to squeeze on non-filers

FBR faced challenges in bringing 3.2 million retailers into tax net
Representational image. Reuters
Representational image. Reuters

The Federal Board of Revenue (FBR) has prepared a mini-budget that proposes stringent actions against tax defaulters, including freezing bank accounts and prohibiting the purchase of vehicles and properties. These measures required parliamentary approval for implementation.

According to a report in Jang, as part of the ongoing effort to broaden the tax base, the FBR faced challenges in bringing 3.2 million retailers into the tax net, raising concerns about meeting targets for the July-September quarter, particularly under the IMF’s Extended Fund Facility (EFF) program.

High-ranking officials confirmed that the FBR identified 2 million nil filers among 6 million return filers. The proposed measures included categorizing non-filers into three groups and imposing fines of up to Rs1 million for submitting incomplete or incorrect returns.

The FBR aimed to amend tax laws and grant broader powers to tax authorities, with the government set to present a financial bill or issue an ordinance to facilitate these changes. The proposed actions targeted tax evaders, including freezing bank accounts and disconnecting utilities for those who failed to comply.

The FBR’s internal assessments indicated a potential tax shortfall of over Rs220 billion compared to the set target of 2,652 billion PKR for the first quarter. With an annual tax collection goal of Rs12,970 billion, the FBR faced a significant challenge in meeting its September target of Rs1,196 billion.

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If tax collection failed to meet expectations, the IMF might have demanded additional tax measures through the mini-budget. The FBR was prepared to introduce these stringent actions to ensure compliance rather than overburden existing taxpayers.

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