ISLAMABAD, April 20 — Income tax recoveries through audit proceedings in Pakistan surged by 110% in fiscal year 2024-25, reflecting improved enforcement and audit efficiency, the Federal Board of Revenue said in its annual report.
The FBR said collections from audit-based demands rose to Rs267 billion in FY25, compared with Rs127 billion in the previous fiscal year, marking a significant increase in revenue recovery efforts.
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Officials said the rise highlights stronger audit selection processes and improved compliance outcomes as the tax authority continues efforts to broaden the tax base and enhance enforcement.
The breakdown of income tax collection out of demand over the past five fiscal years is as follows:
| Fiscal Year | Collection out of Demand (PKR) |
| 2020-21 | Rs80 billion |
| 2021-22 | Rs101 billion |
| 2022-23 | Rs162 billion |
| 2023-24 | Rs127 billion |
| 2024-25 | Rs267 billion |
The data shows a volatile trend in earlier years, followed by a sharp rebound in FY25.
The FBR reported that recovery from arrear demands also increased significantly, rising to Rs97.25 billion in FY25 from Rs31.68 billion in the previous year. Meanwhile, collections from current demand reached Rs170 billion, compared with Rs96 billion in FY24.
Officials attributed the overall improvement to enhanced audit targeting and better risk profiling of taxpayers, which helped identify underreported income and strengthen enforcement outcomes.
The FBR said in a statement that the 110.3% increase in “collection out of demand” reflects “improvement in audit selection and quality of audit,” underscoring efforts to strengthen revenue mobilisation.
Tax analysts say sustained gains in audit recoveries could help improve fiscal stability, though they caution that long-term revenue growth will depend on widening the tax net and reducing reliance on enforcement-driven collections.