Islamabad, Pakistan – The Federal Board of Revenue (FBR) has unveiled a comprehensive reform plan to address the widening tax gap, which has reached a staggering Rs7 trillion in the previous fiscal year.
The FBR’s first tax gap report, released in September 2024, highlighted the significant discrepancy between the taxes owed and the taxes actually paid by taxpayers. This alarming trend underscores the urgent need for reforms to enhance tax compliance and meet the government’s revenue targets. Dawn
The FBR’s reform plan includes several key measures:
- Digital Invoicing: Mandatory digital invoicing for all manufacturers will be implemented within four to five months.
- Desk Audits: Tax officials will receive training and be supported by sector experts to conduct desk audits of tax returns.
- Citizen Monitor Scheme: The FBR will reward purchasers who report non-digital receipts from shopkeepers.
- POS Expansion: The number of outlets with point-of-sale (POS) systems will be increased from 33,000 to 60,000.
- Tax Return Audits: The FBR will engage chartered accountants to conduct desk audits of tax returns.
- IT Infrastructure and Staffing: The FBR will enhance its IT infrastructure and recruit competent staff.
The FBR’s reform plan aims to address the tax gap in various sectors, including sales tax, income tax, and customs duties. By implementing these measures, the FBR hopes to improve tax compliance, increase revenue collection, and strengthen Pakistan’s economic position.
