The Federal Board of Revenue (FBR) has announced a significant move in its effort to ensure tax compliance: starting January 2024, non-filers of tax returns will face the blocking of their SIMs and utility connections. FBR Chairman Amjed Zubair Tiwana, in a briefing to a select group of media personnel, outlined the new enforcement strategy aimed at enhancing tax collection and broadening the tax base.
Deadline for Notices and Consequences for Non-Compliance
Chairman Tiwana highlighted that the deadline for responding to notices issued to non-filers was set for December 28-29, 2023. Post this deadline, the FBR will publish a general order listing the names of those who have failed to comply. Subsequently, these non-compliant individuals will face the termination of their electricity and gas connections as a part of the enforcement measures.
This step is in line with legal requirements that mandate the FBR to publicize the names of non-filers after issuing notices. The process of disconnecting utilities and blocking SIM cards is set to follow this disclosure.
Impact on Tax Collection
The chairman proudly noted that the FBR’s proactive measures, including advance taxes and assessments, have significantly boosted tax collection in the first half of the fiscal year 2023-24. This improvement reflects the organization’s commitment to enhancing Pakistan’s tax system.
A notable point raised by Chairman Tiwana was the composition of tax revenue sources. Approximately 40% of the taxes are collected from imports, while a more significant portion, 60%, is derived from domestic sources. This distribution underscores the importance of strengthening domestic tax compliance.
Addressing Maladministration in Refunds
In response to a question about the management of tax refunds, Chairman Tiwana acknowledged the challenges of maladministration in this area. He assured that the FBR has effectively minimized issues at the lowest verification levels, ensuring a more efficient and transparent refund process.
This initiative by the FBR marks a pivotal step in Pakistan’s journey towards a more compliant and robust tax system. The focus on legal enforcement and operational improvements signals a firm commitment to national economic stability and growth.