FBR Decides to Block Mobile Sims of Non-Filers Across Pakistan After Eid

The Federal Board of Revenue (FBR) has decided to launch a major crackdown against non-filers in April 2024 by blocking 0.5 million SIMs of mobile phones of non-filers of income tax returns. In this regard, the FBR would issue an Income Tax General Order (IGTO) after Eid. With the assistance of the Pakistan Telecommunication Authority (PTA), the FBR will identify 400,000 under-filers who did not bother to file their returns. Additionally, there will be 100,000 non-filers identified by the Broadening Tax Base (BTB) initiative of the FBR, and their SIMs will also be blocked. The FBR received a total of 5.9 million income tax returns in tax year 2022, but this figure dropped to 4.2 million in tax year 2023 until March 2024, in line with the Active Taxpayers List (ATL). Approximately 1.8 million individuals did not file their returns. Under Section 114 (B) of Income Tax Law 2023, the FBR possessed powers to enforce the filing of returns. It states “(1) Notwithstanding anything contained in any other law for the time being in force, the Board (FBR) shall have the powers to issue income tax general order in respect of persons who are not appearing on active taxpayers’ list but are liable to file a return under the provisions of the Ordinance. “(2) The income tax general order issued under sub-section (1) may entail any or all of the following consequences for the persons mentioned therein, namely: (a) disabling of mobile phones or mobile phone SIMs; (b) discontinuance of electricity connection; or (c) discontinuance of gas connection. “(3) The Board or the commissioner having jurisdiction over the person mentioned in the income tax general order may order restoration of mobile phones, mobile phone SIMs, and connections of electricity and gas, in cases where he is satisfied that — (a) the return has been filed; or (b) person was not liable to file a return under the provisions of the Ordinance. “(4) No person shall be included in the general order under sub-section (1) unless the following conditions have been met with, namely: (a) notice under sub-section (4) of section 114 has been issued; (ii) utility connections; (iii) business premises including all manufacturing, storage or retail outlets operated or leased by the taxpayer; (iv) types of businesses; and (v) such other information as may be prescribed; (c) shall be signed by the person being an individual, or the person’s representative where section 172 applies; and (d) shall be filed electronically on the web prescribed by the Board. “(5) A taxpayer’s profile shall be furnished, (a) on or before the 31st day of December 2020 in case of a person registered under section 181 before the 30th day of September 2020; and (b) within ninety days of registration in case of a person not registered. (b) the date of compliance of the notice under sub-section (4) of section 114 has elapsed, and (c) the person has not filed the return. “(6) The action under this section shall not preclude any other action provided under the provisions of the Ordinance,” it concluded.