FBR’s latest punitive move

The FBR has finally followed through on its threat to block the mobile phone connections of non-filers, ordering the blocking of over 500,000 non-filers’ SIMs earlier this week. The move has generated criticism from almost all sides, since a significant number of the people being punished are salaried individuals who are already taxpayers, but simply chose not file returns.

Instead of focusing its energy on facilitating tax evasion through amnesties on property and other relaxations aimed to benefit the elite, the FBR should focus on creating a tax system that is fair and easy to comply with. The government should also provide incentives to encourage tax compliance, rather than opting for punitive measures. Most countries guarantee tax refunds for people with low or no income simply for filing. While the FBR would claim its lower rates for filers were a similar measure, in practice, it was more akin to breaking one knee instead of both, while the people who actually should be paying the FBR millions and billions more are allowed to keep using loopholes to understate their incomes.

The fact that only 4.5 million people have filed for the 2023 tax year, even though filing went up to a record 5.9 million people for 2022, is also a reflection of the economic catastrophe citizens have been living through. The decision is simply another reflection of the government’s failure to expand the tax net and its inability to create a tax system that is equitable and encourages taxpayers to comply voluntarily.

It is also worth noting that the SIM suspension order comes while FBR officials are reportedly planning to go on strike over the PM’s decision to suspend 25 top FBR officials over corruption allegations. Similar to an abusive parent, the FBR claims it is “fostering a culture of tax compliance and accountability among taxpayers” when it is really just bleeding out defenseless citizens to make up for its own shortcomings.

Published in The Express Tribune, May 2^nd, 2024.

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