MULTAN: Retailers in the Multan region contributed Rs1.293 billion to the national exchequer during the tax year 2023, according to data released by the Regional Tax Office (RTO) Multan. This contribution comes from 21,727 registered retailers who filed their tax returns, reflecting a growing trend of compliance in the region.
Nationally, however, the tax collection from retailers remains a significant challenge. Out of 3.1 million retailers across the country, only 270,000 filed their returns during the same period, collectively contributing a mere Rs34 billion. This figure highlights a stark contrast with other sectors, particularly the salaried class, which contributed Rs375 billion in the last fiscal year, a figure expected to rise to Rs450 billion in the current fiscal year due to increased tax rates.
Exporters, who earned substantial foreign exchange, paid between Rs80 billion to Rs90 billion under the fixed income tax regime last year. However, they have now been brought under the normal tax regime, further intensifying the tax burden on them.
In sharp contrast, the agriculture sector, predominantly controlled by influential feudal lords and agriculturists, contributed only Rs2 billion through Agriculture Income Tax (AIT). The majority of these individuals hold significant political power and are well-represented in parliament, raising concerns about the fairness and effectiveness of the current tax system.
In Multan, the contribution of Rs1.293 billion by retailers stands out as a positive indicator of tax compliance, yet it also underscores the broader challenges faced by the Federal Board of Revenue (FBR) in ensuring an equitable tax system. The Tajir Dost Scheme, which has been scrutinized and endorsed by the International Monetary Fund (IMF), remains a key component of the government’s strategy to broaden the tax base. However, with Pakistan seeking a $7 billion bailout package under the Extended Fund Facility, any modifications to the scheme at this stage appear unlikely.
As the government continues to grapple with these challenges, the focus remains on enhancing tax compliance across all sectors, particularly those with substantial political influence, to ensure a fair and sustainable tax system for the country.
