Islamabad, Jan 6: The Federal Board of Revenue (FBR) has expressed serious concerns over the significant disparities in tax compliance for the fiscal year 2023-24, particularly the gap between income tax and sales tax participation. According to a recent FBR report, while there are 4,738,595 active income taxpayers, only 234,193 individuals are registered as sales tax filers, highlighting a major compliance gap.
The Regional Tax Office (RTO) Lahore has emerged as a leader in both income and sales tax categories, with 809,131 active income tax filers and 41,783 sales tax filers. Karachi and Faisalabad also show strong performance in tax compliance, but smaller regions like Sialkot have also demonstrated relatively good participation in both tax categories.
In contrast, Larger Tax Offices (LTOs) such as those in Multan and Islamabad report lower numbers, reflecting their focus on specialized taxpayers. The stark differences in the active taxpayer-to-sales tax filer ratios across regions suggest a pressing need to expand sales tax compliance, particularly in areas with high income tax participation.
The report further reveals that urban centers dominate the tax base, but smaller regions like Sialkot are bucking the trend with a relatively better performance in tax filings. This uneven tax participation underscores the importance of addressing the gap in sales tax compliance and ensuring that all regions contribute equally to the national tax system.
Overall, the FBR’s findings call for increased efforts to streamline tax collection mechanisms and encourage broader compliance with sales tax laws, especially in areas with a high number of income tax filers.
