In an assertive move to enhance tax compliance, the Federal Board of Revenue (FBR) is set to block approximately 500,000 SIM cards of individuals failing to file or adequately file tax returns after Eidul Fitr.
This decision targets 400,000 under-filers and 100,000 non-filers, identified through the FBR’s tax base broadening initiatives. Notices were sent to these individuals, but they have not filed their returns.
The action, scheduled within the current month, follows the FBR’s coordination with the Pakistan Telecommunication Authority (PTA) to pinpoint defaulters.
A senior FBR official confirmed that the Income Tax General Order (IGTO) would be issued post-Eid, marking the commencement of SIM blockages.
This move comes amid concerns from telecom companies regarding the potential impact of widespread SIM deactivations.
Initially, the FBR identified two million potential non-compliant individuals, but after consultations, it was decided to limit the first phase to 500,000 SIM blocks.
The FBR, which saw a decrease in tax return filings from 5.9 million in 2022 to 4.2 million in 2023, is leveraging its legal authority under the Income Tax Law 2023. This law empowers the FBR to disconnect mobile, electricity, and gas services for non-compliance.
However, services can be restored once compliance is demonstrated or if it is established that the individual was not required to file a return.
This strategy is part of the FBR’s broader efforts to enforce tax laws and ensure compliance, emphasizing the importance of filing returns and maintaining active taxpayer status.
We believe this initiative, coupled with taxpayer education and support, can be a significant step towards a more robust tax system in Pakistan. We encourage all individuals to fulfill their tax obligations and ensure they are compliant.
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