Minister for Interior and Commerce, Gohar Ejaz stated that Pakistan faces a significant challenge in expanding its tax base. Despite a workforce of 71 million, the country has only 5.9 million tax filers, representing a mere 8.4% tax filer-to-workforce ratio.
This starkly contrasts with the banking sector’s reach, where 177 million accounts are held by 137 million unique individuals, accounting for 60% of the adult population and holding deposits totaling Rs32.7 trillion as of May 2025. Crucially, banks possess complete Know Your Customer (KYC) data for these accounts.
Ejaz emphasizes that the Federal Board of Revenue (FBR) needs to significantly increase its tax base and revenue to meet the target of Rs14.1 trillion. He argues against burdening existing taxpayers, advocating for relief for the salaried class by capping their maximum tax slab at 20%.
The discrepancy between 137 million unique bank account holders and only 5.9 million tax filers reveals a vast untapped potential for tax collection. In fiscal year 2025, the FBR collected Rs11.9 trillion against a budgetary target of Rs12.97 trillion, achieving 91.7% of its goal. Ejaz asserts that further taxing existing filers, who are already contributing significantly through withholding taxes (Rs1.59 trillion) and voluntary payments (Rs1.12 trillion in the first half of FY25), is not the solution.
According to Ejaz, the FBR’s focus should shift to identifying and bringing non-filers into the tax net. Banks, with their comprehensive KYC data, hold the key to this expansion. They possess complete account details, transaction histories, and financial profiles of account holders with substantial deposits.
Ejaz advocates for smart governance, urging the FBR to intelligently utilize this readily available data. He believes that achieving Pakistan’s revenue targets hinges not on over-burdening the current 5.9 million compliant taxpayers. But there’s a need to effectively identify the remaining 131 million bank account holders with significant financial footprints in the formal tax system.