Pakistan income tax returns rise by 45%

The number of income tax returns filed in Pakistan has risen by 45% in a year, according to data from the Federal Board of Revenue (FBR).

A total of 5,767,384 income tax returns had been filed by 30 September, compared with 3,980,692 during the same period last year.

That represents an increase of about 1.79 million returns in 12 months.

The number of returns has also nearly tripled over the past three years. In September 2023, about 1.92 million returns had been filed.

The biggest rise came among non-salaried taxpayers, a category that includes traders, shopkeepers, professionals and self-employed people.

Their returns increased by about 60%, reaching 3.81 million, compared with 2.38 million a year earlier.

This group accounted for roughly 80% of the overall increase in the number of returns.

Salaried taxpayers filed about 1.9 million returns, an increase of 22%, while returns from associations of persons rose by 33% to 53,756.

FBR figures also show an increase in the number of returns declaring income above the taxable threshold.

The number rose by 37% to almost 2.5 million, from 1.82 million during the same period last year.

Meanwhile, the number of people showing tax payments in their returns increased by 38% to 3.35 million.

Among non-salaried taxpayers, the number of people showing tax payments rose by about 50% to 1.75 million.

Tax paid through individual returns increased by 11% to Rs34.5bn, while tax paid by associations of persons rose by 16% to Rs3.7bn.

Company tax returns moved in the opposite direction.

Only 7,953 company returns had been filed by 30 September, compared with 11,206 during the same period last year.

Tax paid through company returns also fell, from Rs49bn to Rs39.1bn.

Overall, tax paid with returns stood at Rs77.3bn, down about 7% from Rs83.3bn a year earlier.

The increase in filings comes as the FBR expands its use of information from banks, property records, vehicle registrations and withholding statements to identify people who may have taxable income but have not filed returns.

However, about 39% of the returns filed this year were nil returns, broadly in line with the proportion recorded last year.

The latest figures indicate a substantial increase in the number of people submitting income tax returns, although the rise in filings has not translated into an equivalent increase in tax collected through those returns.

About the Author

Syed Mutahir Hussain Shah

A media professional with a BS in Communication and Media Studies. He currently works as a Sub-Editor at Pakistan Connect, focusing on news writing, editing, and digital journalism.