THE Federal Board of Revenue (FBR) has beaten the revenue collection target for the fourth-consecutive month with collection of Rs 2.75 trillion in July-October and decided to go after one million non-filers of income tax returns after receiving a lacklustre response from the people. While the FBR exceeded its tax collection target for four months by Rs 68 billion, it fell short of the total returns filed in tax year 2022 by almost two million, or 40% of the existing filers.
No doubt, the FBR and its leadership deserves credit for the achievement which has strengthened the position of the country at a time when it is initiating dialogue with the International Monetary Fund (IMF) for the release of the next tranche. Surpassing the target by Rs 68 billion is no small feat given the economic recession and unwillingness of the well-to-do to pay their due share of taxes. However, it should be a matter of concern for the policy-makers that the increase has been witnessed in income tax and FED and not sales tax and customs duty which means business community and industrialists are successfully evading taxes despite repeated attempts made by the FBR to document the economy. Industrialists keep on demanding more and more incentives, relief and subsidies but the data shows the salaried class paid Rs 71 billion in taxes in the first three months of the current fiscal year compared to the payment of just Rs 21 billion by the exporters. While the rationale for compulsory tax registration of at least one million filers based on their withholding tax statements is understandable, there is absolutely no justification to continue to spare sectors like real estate, stock markets, traders, industrialists, exporters and private educational institutions besides professionals like doctors, lawyers and engineers who mint money but pay little or nothing in taxes.
