ISLAMABAD: Pakistan’s tax regulator on Friday said it planned to block mobile phone, electricity and gas connections of individuals not filing their statements of wealth despite the issuance of notices, in an effort to expand the tax net.
The development came as part of restructuring measures by the Federal Board of Revenue (FBR), including the establishment of 145 district tax offices that would focus on bringing 1.5 to 2 million new taxpayers into the tax net till June 2024.
The new initiative will help broaden the tax base and ultimately raise the tax-to-GDP ratio to a desired level, according to the FBR. These offices would be headed by district tax officers entrusted with the responsibility of enforcing income tax returns from non-filers and stop filers.
“One of the tools to be utilized for this purpose would be invoking recently introduced section 114B in the Income Tax Ordinance, 2001 which authorizes the department to disconnect utility connections, including electricity and gas connections, and blocking of mobile sims, if return is not filed in response to notices issued,” the FBR said in a statement.
The establishment of these offices will fill a critical tax gap on the path to bring all potential taxpayers into the tax net, according to the regulator.
They will obtain and utilize third-party data, acquired from multiple departments and agencies, that holds “critical information regarding investment in assets and incurring of huge expenditures” by potential taxpayers who have so far managed to escape and stay away from the taxation system, including registration and filing of tax returns.
“Prime Minister has stressed the importance of revenue and increasing the existing number of tax filers during recent meetings,” the FBR said. “Federal Government is committed to utilize all measures and provide assistance to FBR.”
It said a new documentation law was also being introduced to obligate various agencies and departments to provide data to the tax regulator through an automated, common transmission system, for which the FBR has sought assistance from the National Database and Registration Authority (NADRA).
Pakistan regulator moves to block mobile, utility connections of non-filers in bid to expand tax net
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Pakistan regulator moves to block mobile, utility connections of non-filers in bid to expand tax net
- The move comes as part of restructuring plan by the Federal Board of Revenue to add new taxpayers
- The FBR has set up 145 district offices aiming to bring up to 2 mln new taxpayers into net till June 2024
Pakistan forecasts inflation to remain in moderate 5.5-6.5 percent range
- Finance Division report says robust remittance inflows, steady performance of IT, service sectors to cushion external pressures
- Consumer inflation in Pakistan has significantly reduced over the years when it surged to a record high of 38 percent in May 2023
ISLAMABAD: Inflation is expected to remain in the moderate range of 5.5 to 6.5 percent for December, the Finance Division said in its Monthly Economic Outlook report on Wednesday.
Pakistan reported inflation at 6.1 percent on a year-on-year basis in November as compared to 6.2 percent in October. Pakistan’s inflation rate rose to a record high of 38 percent in May 2023 on account of surging food and fuel costs as Islamabad scrapped subsidies as part of a financial deal agreed with the International Monetary Fund (IMF).
“Inflation is projected to remain moderate, in the range of 5.5-6.5 percent in December, primarily reflecting base effect,” the report said.
The Finance Division’s report said Pakistan’s economic outlook remains “positive,” driven by sustained growth in industrial activity due to continued momentum in textiles, automobiles, cement and food processing sectors.
“Robust remittance inflows and steady performance in IT and services exports are likely to cushion external pressures,” the report said.
The report said Pakistan’s current account recorded a surplus of $100 million while it posted a deficit of $812 million during the July-November period.
It said remittances increased by 9.3 percent to $16.1 billion in November, led by inflows from Saudi Arabia (24.2 percent) and the UAE (20.8 percent), while the net foreign direct investment inflows were recorded at $927.4 million during the same July to November period.
It said Pakistan’s fiscal consolidation is expected to continue supporting macroeconomic stability, with government efforts in expenditure management, enhanced tax collection and structural reforms contributing to sustainable growth.
“Overall, Pakistan’s economy is projected to maintain its positive momentum in the coming months, driven by industrial growth, improved governance, digitalization, and prudent macroeconomic management,” the report said.
