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In a worrying revelation, the Federal Board of Revenue (FBR) has disclosed that one-third of Pakistan’s tax filers around 1.7 million out of 5.5 million declared zero income in their latest tax returns. The discovery has prompted the FBR to prepare for a major nationwide audit crackdown to detect underreporting and possible tax evasion.
Pakistan has long struggled with a narrow tax base, where a small portion of citizens contribute significantly to national revenue. Despite efforts to increase compliance through automation and reminders, many individuals and businesses continue to file ‘nil’ returns to avoid paying taxes.
FBR officials revealed that 977,000 filers reported lower incomes this year compared to last year a red flag for potential evasion.
“Certain exporters are showing losses in their returns. The FBR has decided to issue tax notices after October 31, urging them to revise their returns, or the law will take its course,” a senior official stated.
The FBR has hired 2,000 auditors to conduct detailed assessments across all regions. Notices will be dispatched after the October 31 deadline, targeting those with suspicious filings or sudden income drops.
To ensure compliance, the FBR has already sent three reminders to filers, warning that it has access to their banking and transaction data. The extended deadline aims to attract an additional three million returns this fiscal year. Officials confirm that data from ‘nil’ filers will be analyzed to identify potential taxpayers and convert insights into revenue.
Experts believe this crackdown marks one of FBR’s most aggressive audit initiatives in recent years, aimed at increasing transparency and expanding the tax net to stabilize Pakistan’s fiscal system.
