FBR chief hints at shutting down non-filers' businesses

ISLAMABAD: The Federal Board of Revenue (FBR) chief has apprised the Senate’s Standing Committee on Finance and Revenue that electricity and gas connections of non-filers would be suspended as part of the government's efforts to broaden the tax net. 

Besides, FBR Chairman Zubair Tiwana also informed the Senate panel on Saturday that the shutting down of non-filers' businesses was also on the cards as the federal government seeks to enhance tax-to GDP ratio.

In a latest development, the Senate’s Standing Committee on Finance and Revenue on Saturday okayed the proposal to impose a foreign travel ban on non-filers. A series of decisions were made in today’s session of the Senate body held under the chair of Saleem Mandviwalla.

FBR Chairman Zubair Tiwana informed the upper house body that those who failed to file tax returns would face actions under the Income Tax General Order (ITGO), however, exemptions would be given to nationals for Hajj, Umrah, children, students and holders of National Identity Card for Overseas Pakistanis (NICOP).

He detailed that non-filers will face suspension of their SIM cards, electricity and gas connections, as well as their businesses could be shut down.

During the session, Pakistan Peoples Party (PPP) Senator Farooq H Naek stressed that the travel restrictions on non-filers should be executed in the same way which were enforced on those who came under the category of exit control list (ECL).

Tiwana further said that a higher withholding tax rate was approved for the non-filers. He added that the non-filer list included 500,000 people with over 2 million in annual income.

He added that the listed individuals had already disclosed their income statements with their tax return documents in the past. The FBR’s top officer said that temporary filers will also have to pay additional tax during the purchases of vehicles, plots and residences.

Additionally, the Senate body also approved a proposal to reduce the salary slab and hike tax besides, approving the imposition of a 75% withholding tax on cellular and internet bills of non-filers.

Earlier this week, Finance Minister Muhammad Aurangzeb emphasised the need for widening the tax net, saying that the country cannot run with a 9.5% tax-to-GDP ratio.

“We have to bring everyone into the tax net. We are aiming to bring everyone on the active taxpayers' list,” said the finance czar while speaking on Geo News programme 'Aaj Shahzeb Khanzada Kay Sath' on Wednesday.

“We have to abolish the non-filer category in the country,” he added.

His statement comes hours after he unveiled the federal budget for the fiscal year 2024-25 in the National Assembly, with a total outlay of Rs18.9 trillion.