The Federal Board of Revenue (FBR) has launched a soft media campaign sensitizing all potential tax-payers to file returns and pay their due taxes. It has reminded them that the authorities now have comprehensive access to assets and expenditure of the citizens and it is next to impossible for them to hide their real income.
It is appreciable that instead of using strong-arms tactics; the Board has opted to launch a friendly campaign aimed at motivation of citizens to become filers. It is regrettable that those who are otherwise enjoying a luxurious lifestyle are also not paying their taxes but they are now being exposed thanks to the computerization of different processes and transactions. There are one million filers claiming to have non-taxable income but FBR has the evidence to the contrary. Similarly, 7.4 million individuals whose withholding tax is being deducted but they fail to file returns as required under the law. Again, out of one hundred thousand registered companies, fifty thousand are non-filers and 105,00 STRN holders do not file their returns. In a related development, the Federal Board of Revenue (FBR) and NADRA on Wednesday signed a memorandum of understanding (MoU) for data exchange on real time basis for expanding tax base. Cooperation with NADRA and plan to have future links with other organizations has a huge potential for identification of persons who are either outside the tax net or conceal their income and assets. We would, however, point out that instead of focusing on increasing the number of filers with negligible impact on collections, the FBR should concentrate on bringing into tax net those who have significant earnings and are either not paying anything in taxes or pay negligible amounts. A case in point is hundreds of thousands of shopkeepers and professionals (doctors, lawyers and educators) who mint money but do not pay their due taxes.
