Karachi, February 5, 2024 – In a significant milestone, the Federal Board of Revenue (FBR) announced on Monday that the number of active taxpayers in Pakistan has reached new record high at 5.63 million, according to the weekly Active Taxpayers List (ATL) for the tax year 2022.
The data, reflecting returns filed up until February 4, 2024, underscores the government’s unwavering commitment to expanding the tax base and boosting revenue collection.
The surge in active taxpayers is seen as a pivotal step in elevating the tax-to-GDP ratio, a crucial indicator of fiscal health. FBR officials express optimism about sustaining this upward trend, attributing it to their aggressive campaign aimed at bringing more individuals with taxable income into the formal tax fold. Inclusion in the ATL offers tangible benefits, including lower tax rates on various financial transactions, providing a strong incentive for compliance.
Despite these advantages, a notable number of individuals with taxable income continue to operate outside the formal tax system, often due to factors such as possessing undocumented wealth. Acknowledging this challenge, the FBR openly recognizes the limited scope of the current active taxpayer base compared to the country’s vast population of 240 million.
In a statement, the FBR emphasizes, “Pakistan confronts a formidable challenge in its fiscal landscape characterized by rampant tax evasion, an alarmingly low tax-to-GDP ratio, and an inadequately low number of tax filers.” The country’s revenue generation is significantly affected, leading to insufficient funding for critical public services and socio-economic development initiatives.
To address these challenges, the FBR has outlined a comprehensive strategy to identify and integrate individuals with taxable income into the system. Their nationwide drive encourages all eligible individuals and income earners to “get registered with the Tax system and file their return of income.”
While the surge in active taxpayers showcases the effectiveness of the FBR’s initiatives, sustained efforts are deemed crucial to tackling tax evasion, encouraging compliance, and unlocking the country’s true economic potential. Embracing transparency and accountability can pave the way for a more robust and inclusive economy, capable of addressing the needs of Pakistan’s growing population and securing a prosperous future for its citizens.
