Tax Expert Supports Prosecution of Non-Filers

ISLAMABAD, PAKISTAN: Leading tax professionals and chartered accountants have voiced strong support for the Federal Board of Revenue’s (FBR) upcoming Tax Laws (First) Amendment Ordinance 2024, which aims to prosecute non-filers and late filers. The initiative, spearheaded by FBR Chairman Rashid Mahmood Langrial, is seen as a crucial step toward bolstering tax compliance in Pakistan.

Former FBR Chairman Shabbar Zaidi expressed his endorsement of the ordinance, calling it a significant move to enforce accountability in the tax system. In an interview with Business Recorder on Sunday, Zaidi highlighted the importance of ending the “legal cover” that currently shields non-filers under the income tax law. “The non-filers must be prosecuted,” Zaidi stated, emphasizing the need for strict enforcement measures.

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Zaidi also reflected on his tenure in 2019, during which he abolished the category of non-filers in an attempt to streamline tax compliance. He noted that the proposed amendment builds on this approach by addressing three critical categories of taxpayers: non-filers, late filers, and individuals not legally required to file returns.

“The FBR must ensure fairness for the third category—citizens who are not obligated to file income tax returns,” Zaidi said. He stressed that while non-filers and late filers should face prosecution, the system must also safeguard the rights of individuals who genuinely fall outside the tax net.

The ordinance is expected to revoke the legal validity of non-filers, signaling a stricter stance on tax compliance. Experts believe that this measure will contribute to reducing the tax gap, improving revenue collection, and fostering a culture of accountability in Pakistan’s tax system.

With the draft ordinance underway, stakeholders across the financial sector are closely watching its development, viewing it as a potential game-changer in the country’s fiscal governance.

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