The Federal Board of Revenue (FBR) in Pakistan is encountering significant challenges in its mission to bring professionals such as doctors, engineers, and lawyers into the tax net, as demanded by the International Monetary Fund (IMF) following resistance by these professionals.
According to FBR officials, the IMF has urged Pakistan to ensure that all professionals with taxable income are registered for taxation. However, the FBR's endeavours to register hundreds of thousands of doctors, engineers, and lawyers are being met with staunch resistance from these professional groups.
As part of its ongoing efforts, the FBR has sent data pertaining to 70,000 doctors and 120,000 engineers to field formations for registration purposes, while lawyers refuse to be included in the tax net as they have not even responded to the notices sent to them. The bureau says its efforts to bring hundreds of thousands of lawyers, doctors, and engineers into the tax net have been met by resistance.
To address the challenges posed by the legal profession, the FBR intends to collaborate with tax bar associations to facilitate the registration of lawyers. Moreover, the FBR plans to intensify its actions against non-filers once the new government assumes office, sources say.
Sources indicate that the progress made in expanding the tax net will be communicated to the IMF during the upcoming discussions. Notably, FBR officials say that the number of individuals filing tax returns has significantly increased, reaching over 3.8 million, compared to just three million during the same period last year.
In preparation for negotiations with the IMF scheduled for March and April, the FBR is diligently undertaking the necessary groundwork. As Pakistan navigates the complexities of tax reforms and compliance, the challenges posed by professionals' resistance underscore the importance of effective measures to enhance revenue generation and fiscal stability.
