Tax filing surges 58.7 percent to 2 million till June 17

KARACHI: Tax authorities had received 58.7 percent more income tax returns till June 17, compared with the year before, amid a drive by the government to boost the country’s notoriously weak tax compliance though amnesty and frequent extensions in filing deadlines, officials said on Thursday.

An updated Active Taxpayers List (ATL) issued by the Federal Board of Revenue (FBR) showed that the number of income return filers increased to 1.999 million in the tax year 2018.

The government expects the recently announced tax amnesty scheme will draw more people to file tax returns before the deadline of June 30.

FBR data showed that 1.94 million tax returns were received till previous filing deadline of April 30. The government later extended return filing deadline to June 30. Around 60,000 more returns were filed after June 3,” a source said.

A senior Inland Revenue official said the number of return filers is increasing due to measures taken by the FBR during the last six months, including “enforcement against non-compliant taxpayers and data gathering of financial and business transactions to identify people having taxable income, but not on the tax roll”.

“Measures proposed through the Finance Bill 2019 are also a reason, which compelled the people to discharge their liabilities.”

A new schedule to the Income Tax Ordinance, 2001 has been proposed through the Finance Bill 2019, which is related to Active Taxpayers List. The bill proposed to double the withholding tax rates for persons or companies not appearing on the ATL, the official said.

The bill also proposed to omit the terminology of ‘non-filer’ for persons who file their income tax returns after the stipulated time, but their names would not appear on the ATL.

The official said the ATL for the tax year 2019 will be issued in March 2020 and “in that list only those individuals and companies will be able to appear, who file their returns by September 2019 in case of individuals and companies having special tax year and December 31, 2019 in case of other companies”.

Officials said the number of return filers for the tax year 2018 would be increased, “as ongoing asset declaration scheme gathered pace”. So far, the returns filing under this scheme is not encouraging due to late announcement.

Analysts said the number of return filers was also increasing due to repeated announcements of the FBR for taking harsh measures after July 1, 2019 as plenty of data of individuals and companies were gathered.