The government is facing mounting challenges in achieving its income tax collection targets, as a large number of holders of Electronic Tax Identification Numbers (e-TINs) continue to avoid submitting their income tax returns. In response, the National Board of Revenue (NBR) has announced a stricter enforcement strategy.
According to NBR Chairman Md. Abdur Rahman Khan, taxpayers who possess e-TINs but fail to file returns will first receive automated notices generated from the national database. If they still do not comply, tax inspectors may be deployed to visit their residences and take necessary action.
Despite several extensions, the deadline for filing returns for the current fiscal year ended on 31 March. Out of approximately 12.8 million registered e-TIN holders in the country, only around 4.25 million taxpayers submitted their returns this year. This leaves more than 8 million individuals outside the tax filing system.
Officials of the tax authority argue that a significant portion of these non-filers have taxable income but are deliberately avoiding compliance. They warn that under existing tax law, concealing income or failing to file returns is a punishable offence, prompting the shift towards a tougher stance.
Consequences of Not Filing Tax Returns
Taxpayers who fail to submit their income tax returns within the stipulated time may face multiple legal and financial consequences under the Income Tax Act. These include penalties, loss of tax benefits, additional charges, and even disruption of essential services in certain cases.
| Type of Consequence |
Description |
| Monetary Penalty |
A fine of 10% of the last assessed tax amount, subject to a minimum of 1,000 currency units. An additional daily penalty of 50 units may apply for continued failure. |
| Loss of Tax Benefits |
Withdrawal of tax exemptions and rebates, including benefits from approved investment schemes such as savings instruments. |
| Additional Tax Burden |
A monthly surcharge of 2% on payable tax may be imposed for delayed filing. |
| Utility Restrictions |
Authorities may authorise disconnection of electricity, gas, water, and other state-provided services. |
| Salary Complications |
Employees may face difficulties in receiving salaries or allowances, particularly in cases where proof of return submission is required. |
Officials also noted that many public and private sector employees are required to submit proof of tax return filing as part of salary processing procedures. Failure to do so may result in withheld payments or administrative delays.
With enforcement measures set to intensify, tax authorities have indicated that compliance monitoring will be significantly strengthened in the coming months to broaden the tax net and improve revenue collection.
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