Number of return filers drops by half to 1.5mln

KARACHI: The Federal Board of Revenue (FBR) received around 1.5 million tax returns for tax year 2020 by Monday evening. However, this number was much lower when compared with record return filing of 2.98 million for tax year 2019.

The FBR on Monday issued the weekly Active Taxpayers List (ATL) for tax year 2019, and updated the number of return filers up to December 6, 2020. The updated ATL shows the number of return filers has increased to a record high at 2.98 million.

The last date for filing income tax return is December 8, 2020 for tax year 2020. It seems unlikely that the remaining 1.5 million tax payers would file their returns on the last day.

The reasons for lower returns received by the FBR could be attributed to resurgence of coronavirus and calculation errors pointed out by tax bars. On the other hand, the FBR has rejected extending the last date beyond December 8. The FBR made it clear that it had already granted a 90-day extension as per statute.

Tax experts believe that the lower number of tax returns would not be good for the FBR’s image, as it had taken many initiatives for broadening the tax base.

They said the general perception was that the FBR would get only around one million returns from shopkeepers and retailers, as the revenue board issued a special simplified single-page return form for this segment.

Further, the FBR obtained information through third party sources and made it available on an online portal, encouraging citizens to check their transactions and file their returns to avoid penal action.

Besides, the FBR also introduced a simple wizard based return filing application to facilitate salaried persons in discharging their liability. However, considering the latest number of return filing for tax year 2020, the taxpayers and persons required to file returns have not responded to the FBR efforts. Tax experts said that someone in the FBR should be responsible to analyse all the efforts and overall response.

Tax bars and business communities have been approaching different authorities for extension in date for filing tax returns. The FBR issued date extension instructions to all the tax offices to facilitate taxpayers seeking date extension on individual basis.

The FBR issued instructions to tax offices to facilitate and allow many taxpayers through one request. Sources in the FBR said that the date would likely be extended, but at the finance ministry level.