ISLAMABAD: Despite a 76 percent surge in the number of income tax return filers during the tax year 2024, the actual increase in tax revenue remained limited to just 30 percent.
The Auditor General of Pakistan (AGP) attributes this discrepancy to a large number of individuals filing returns merely to avail reduced tax rates offered to filers on transactions such as the sale or purchase of property and vehicles, without paying any meaningful tax.
The AGP report, which scrutinises the performance of Federal Board of Revenue (FBR)’s Broadening of Tax Base (BTB) wing, notes that the increase in tax filers from 2.959 million in 2023 to 5.215 million in 2024 has not translated into a proportional rise in revenue.
Most new filers, the audit points out, seem to be entering the tax system for procedural benefits rather than fulfilling any real tax obligations.
The report also highlights a disturbing trend in the country’s tax-to-GDP ratio, which has fallen from 10.6 percent in 2016-17 to 8.7 percent in 2023-24, despite the availability of extensive third-party data with the FBR. The Malomaat Portal, hosted on the IRIS system, includes records of individuals with industrial electricity and gas connections, high-end vehicles, and frequent foreign travel — all indicative of significant earning capacity — yet many such individuals continue to file nil returns and contribute no taxes.
The report said that several serious shortcomings first flagged in a 20
