ISLAMABAD: Income tax recoveries through audit proceedings jumped by 110% in fiscal year 2024-25, signaling stronger enforcement and improved audit performance, according to the Federal Board of Revenue.
The tax authority reported that collections from audit-based demands climbed to Rs267 billion in FY25, up from Rs127 billion in FY24, reflecting a significant boost in revenue recovery efforts.
Officials said the increase highlights more effective audit selection, improved compliance outcomes, and ongoing efforts to broaden the tax base.
The breakdown of income tax collection out of demand over the past five fiscal years shows a fluctuating trend followed by a sharp rebound in FY25: Rs80 billion in 2020-21, Rs101 billion in 2021-22, Rs162 billion in 2022-23, Rs127 billion in 2023-24, and Rs267 billion in 2024-25.
The Federal Board of Revenue also reported a notable increase in recoveries from arrear demands, which rose to Rs97.25 billion in FY25 compared to Rs31.68 billion in the previous fiscal year. Meanwhile, collections from current demand reached Rs170 billion, up from Rs96 billion in FY24.
Officials attributed the surge to enhanced audit targeting and improved risk profiling of taxpayers, enabling authorities to identify underreported income and strengthen enforcement outcomes.
In its statement, the Federal Board of Revenue said the 110.3% increase in “collection out of demand” reflects improved audit selection and audit quality, underscoring its push to strengthen revenue mobilisation.
Tax analysts say that while stronger audit recoveries can support short-term fiscal stability, long-term revenue growth will depend on expanding the tax net and reducing reliance on enforcement-driven collections.







