Govt empowers FBR with establishment of 145 District Tax Offices to expand revenue base

DTOs authorised to disconnect power connections and block mobile SIMs if individuals fail to file tax returns

The government has extended the powers of the Federal Board of Revenue (FBR) by establishing 145 new tax offices across the country.

These offices are now authorised to take significant measures, such as disconnecting electricity and gas connections, as well as blocking the mobile SIMs of individuals who have not filed tax returns.

As a part of the restructuring efforts, the caretaker finance minister has approved the creation of 145 District Tax Offices. These offices will concentrate on expanding the taxpayer base by 1.5 million to 2 million individuals by June 2024, as stated in a statement by the FBR.

This ambitious goal aligns with the commitments made by the FBR to the Special Investment Facilitation Council (SIFC) and the International Monetary Fund (IMF).

During the last tax year, approximately 4.9 million people filed tax returns. In the recent IMF review, Pakistan pledged to increase this number to 6.5 million by June of the following year.

However, as of the end of October, the FBR had received fewer than 3 million returns. Meeting the target of 6.5 million within the next eight months would require adding 437,000 filers each month, a challenging task without taking coercive action against persistent non-filers.

Under the income tax law, individuals earning above Rs 600,000 per annum or owning a car with a 1,000cc engine are required to file tax returns.

Notably, the FBR emphasized the utilization of Section 114B of the Income Tax Ordinance 2001, allowing the department to disconnect utility connections and block mobile SIMs if individuals fail to file tax returns in response to issued notices.

140% increase in allowance for senior FBR officers

In a related development, the caretaker govermnet has approved an increase of 140% in the FBR’s Headquarters allowance for officers in grades 17 to 22, effective from November 1, 2023.

In line with the executive allowance structure across other ministries/divisions, the government has extended a 140% basic pay allowance to senior officers stationed at the FBR headquarters.

This decision is anticipated to result in an annual expenditure of approximately Rs430 million from the national treasury. However, the government has specified that these expenses will be covered solely from the allocated resources designated for the FBR during the ongoing fiscal year.



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