ISLAMABAD: The Federal Board of Revenue (FBR) has decided to impose a Rs25,000 penalty on traders who file income tax returns under the Easy Tax Scheme after October 15.
Under the reported arrangement, traders filing returns after the deadline will have to pay Rs25,000 in registration charges and an additional Rs25,000 as a penalty. The extension for registration and tax return filing will be granted subject to these additional payments, the sources said.
The development comes as the FBR faces difficulties encouraging traders to register and file returns under the Easy Tax Scheme, with participation reportedly falling significantly short of expectations.
According to the sources, fewer than 150 new tax returns had been filed under the scheme despite extensive efforts to increase registration. The low participation has raised concerns within the government about the scheme’s implementation and its ability to bring more businesses into the formal tax system.
The minister of state for finance has also expressed concern over the limited number of registrations and returns filed under the initiative, the report said.
Overall tax filings increase
Despite the slow response to the Easy Tax Scheme, the overall number of income tax returns filed across Pakistan has increased.
FBR sources said approximately 6.6 million income tax returns had been filed nationwide for tax year 2026 by October 13. The total stood at around 5.8 million on September 30, indicating an increase of approximately 800,000 filings.
However, the overall filing figures include taxpayers beyond those registered under the Easy Tax Scheme and should not be taken as an indication of the scheme’s individual performance.
The FBR has been encouraging traders to register and submit their returns as part of efforts to broaden the tax base and document economic activity.
Different treatment for salaried taxpayers
The report also said that individuals whose only source of income is their salary would not receive notices demanding advance income tax payments.
However, individuals earning income from sources other than salary could be required to pay adjustable advance income tax, according to the sources.
Advance income tax is generally adjusted against a taxpayer’s final tax liability, subject to the applicable tax rules.
Financial implications for traders
The reported charges could increase the cost of compliance for traders who miss the October 15 deadline. Those affected may have to pay a combined Rs50,000 in registration charges and penalties, according to the report.
The development may also influence traders who have yet to complete registration or submit their tax returns under the scheme.
The FBR has continued to encourage traders to participate in the initiative, but the reported low filing rate highlights the challenges of bringing businesses into the formal tax system.
The details of the reported penalty arrangement, including its precise legal basis and applicability to different categories of traders, should be confirmed through an official FBR notification or clarification.
