The Federal Board of Revenue (FBR) has announced its decision to impose stringent restrictions on non-filers of income tax returns, with the first phase of these measures taking effect from October 1, 2024.
The move is part of the government's broader efforts to widen the tax net and increase compliance.
In a press briefing, FBR Chairman Rashid Mahmood Langrial confirmed that the much-debated 'non-filer' category would be abolished, signalling an end to practices allowing individuals to bypass taxes by paying nominal penalties.
He stated that 15 specific restrictions will be imposed on non-filers, with an initial rollout of five key limitations aimed at clamping down on tax evasion.
Restrictions on non-filers
From October 1, individuals who fail to file their income tax returns will face restrictions on:
- Purchasing property
- Buying vehicles
- International travel
- Opening current accounts
- Investing in mutual funds
The FBR has clarified that these are the first in a series of 15 restrictions that will gradually be enforced. This phased approach is intended to tighten the noose around tax evaders and discourage non-compliance.
The move comes as the deadline for filing income tax returns—September 25—draws near. FBR officials have reiterated that no extensions will be granted, and those failing to file by the due date will be subject to the new regulations.
Part of FBR reform plan
The restrictions form a part of the FBR’s comprehensive reform plan, which has already received the approval of Prime Minister Shehbaz Sharif. The reforms aim to align Pakistan’s tax system with global standards by eliminating the non-filer category and promoting a culture of tax compliance.
Criticizing the concept of non-filers, FBR Chairman Langrial noted that such classifications are not recognized internationally and contribute to a lax attitude towards tax obligations.
He stressed that the abolition of the non-filer category is a critical step toward broadening the tax base.
A senior government official, speaking to a local media outlet, revealed that these measures will be implemented through a presidential ordinance. The FBR is currently working on finalizing the rules, in collaboration with the Ministry of Law, to ensure the smooth implementation of the restrictions.
