The Federal Board of Revenue (FBR) in Pakistan faces significant hurdles as it strives to include professionals like doctors, engineers, and lawyers in the tax net, a requirement set forth by the International Monetary Fund (IMF). However, resistance from these professional groups is impeding progress.
FBR officials report that the IMF has emphasized the importance of ensuring that all professionals with taxable income are registered for taxation. Despite the FBR’s efforts to register hundreds of thousands of doctors, engineers, and lawyers, it encounters staunch resistance from these groups.
As part of its ongoing initiatives, the FBR has forwarded data concerning 70,000 doctors and 120,000 engineers to field formations for registration purposes. However, lawyers have not responded to notices sent to them, indicating their reluctance to be included in the tax net.
To tackle the challenges posed by the legal profession, the FBR plans to collaborate with tax bar associations to facilitate the registration of lawyers. Additionally, the FBR aims to ramp up actions against non-filers once the new government assumes office.
Sources suggest that progress in expanding the tax net will be reported to the IMF during upcoming discussions. FBR officials highlight a significant increase in the number of individuals filing tax returns, surpassing 3.8 million compared to three million during the same period last year.
In anticipation of negotiations with the IMF scheduled for March and April, the FBR is diligently laying the groundwork. The resistance from professionals underscores the need for effective measures to boost revenue generation and ensure fiscal stability amid Pakistan’s tax reform and compliance endeavors.
