The Federal Board of Revenue (FBR) is initiating a significant restructuring effort with the establishment of 145 District Tax Offices, a move endorsed by Finance Minister Shamshad Akhtar.
This strategic decision, officially announced by the FBR, marks a pivotal step in the organization’s pursuit of enhancing tax compliance. Each of these offices, under the leadership of District Tax Officers, is tasked with the crucial responsibility of compelling Income Tax Returns from non-filers and encouraging compliance among existing filers.
The overarching goal is to elevate the tax-to-GDP ratio, with a targeted aim of adding 1.5 to 2 million new taxpayers to the system by June 2024.
The proactive approach of these newly established offices will be led by dedicated Inland Revenue Officers holding positions at the BS-17/18 level.
Leveraging third-party data from various departments and agencies, these officers will focus on scrutinizing investments in assets and significant expenditures by individuals who have thus far managed to evade the taxation system.
This comprehensive strategy aims to address the existing tax gap and bring previously untapped potential taxpayers into the fold. The implementation of the recently introduced section 114B in the Income Tax Ordinance, 2001, adds a powerful tool to the FBR’s arsenal, allowing for measures such as disconnecting utility connections and blocking mobile SIMs for individuals failing to comply with the filing requirements.
The collective impact of these initiatives is expected to enhance the overall effectiveness of the taxation system and contribute to improved economic documentation.
The Federal Board of Revenue’s (FBR) decision to establish 145 District Tax Offices underscores a proactive shift towards enhancing tax compliance and expanding the taxpayer base in Pakistan.
Finance Minister Shamshad Akhtar’s endorsement reflects a strategic commitment to address the existing tax gap and promote economic transparency. Led by dedicated Inland Revenue Officers, these offices are poised to utilize third-party data to scrutinize the financial activities of individuals who have previously evaded the taxation system.?