Govt targets tax evaders with stricter measures in Budget FY24-25

ISLAMABAD: In a bid to tighten tax compliance, the proposed FY24-25 budget includes stringent measures to prevent non-filers from leaving Pakistan.

Individuals who fail to file their tax returns, even after receiving notices, will be barred from exiting the country. Exceptions will be made for Hajj and Umrah travellers, minors, students, overseas Pakistanis, and other specific groups as notified by the Board.

Currently, individuals who ignore tax return notices and whose names appear in the income tax general order face severe penalties, including the blocking of their SIM cards and disconnection of utility services.

The new budget proposal extends these penalties by introducing hefty fines for implementing agencies that fail to enforce these measures. Agencies that do not block SIM cards, disconnect utilities, or comply with the travel ban will face a penalty of Rs100 million for the first default, and Rs200 million for each subsequent default.

The budget also introduces penalties and prosecution for entities that fail to fully disclose relevant details in their tax returns, submit incomplete information, or neglect to file returns after discontinuing their business.

Additionally, a penalty involving the sealing of shops is proposed for traders and shopkeepers who do not register under schemes like the Tajir Dost Scheme.

Non-compliance by shopkeepers and traders will now be considered an offence, punishable upon conviction by imprisonment for up to six months, a fine, or both.

These measures reflect the government’s continued efforts to broaden the tax net and ensure greater accountability among taxpayers.

Read next: PDL limit raised to Rs80