MULTAN: President of the Pakistan Tax Bar Association (PTBA), Anwar Kashif Mumtaz, has strongly criticized the country’s tax system, arguing that it discourages honest taxpayers while allowing non-filers to exploit state resources without accountability. He stated that Pakistan’s taxation policies have created an unfair system where compliant citizens face excessive scrutiny, whereas those who evade taxes continue to benefit from public infrastructure, healthcare, and education.
Speaking exclusively to Customs Today, Mumtaz condemned the recent abolition of the Commissioner Inland Revenue (CIR) forum, calling it a major setback for taxpayers seeking justice. He explained that, globally, tax disputes are resolved through a structured legal process—high-value cases go to superior courts, while smaller disputes are settled in tax tribunals. However, Pakistan’s tax system operates in reverse order, adding unnecessary complications for genuine taxpayers while making it easier for tax evaders to escape scrutiny.
He informed that it is a serious injustice that in Pakistan, out of 6.2 million taxpayers, 3.6 million file zero-tax returns, effectively paying nothing. Meanwhile, the Federal Board of Revenue (FBR) and the government keep increasing the tax burden on those who honestly fulfill their obligations.
The real problem is that non-filers continue to enjoy all the benefits of the system without any consequences, while taxpayers are penalized for their compliance. Instead of encouraging tax filing, the system has turned it into a punishment rather than a civic duty.
Mumtaz further criticized the systemic failure of Pakistan’s tax policies, stating that instead of expanding the tax base, the government consistently relies on short-term revenue collection measures that place an unfair burden on those already paying taxes. He noted that in today’s digital era, documenting the entire economy is possible with a single click, yet Pakistan’s reluctance to implement meaningful reforms reflects deep-rooted inefficiencies and vested interests. He argued that the country’s fiscal policies are dictated by the International Monetary Fund (IMF), which prioritizes debt repayments over the welfare of the people.
Highlighting the disconnect between policymakers and ground realities, Mumtaz noted that chambers of commerce primarily lobby for tax incentives, while tax bar associations advocate for legal reforms. However, he lamented that both remain ignored by the authorities, leading to repeated policy failures, such as the “Tajir Dost Scheme.” He explained that the scheme was bound to fail because it lacked practical implementation mechanisms and failed to account for the complexities of Pakistan’s informal economy.
Mumtaz also pointed out a critical flaw in Pakistan’s economic governance the dominance of bankers over economists in key decision-making positions. He stressed that, internationally, economic policies are crafted by seasoned economists, whereas in Pakistan, the financial sector drives economic decision-making, leading to mismanagement and stagnation. He cited India’s 1991 economic reforms under Manmohan Singh as an example of successful policymaking, arguing that Pakistan needs to follow a similar path of bold, long-term economic reforms instead of short-sighted financial maneuvering.
Calling for urgent tax reforms, Mumtaz urged the government to expand the tax net, incentivize compliant taxpayers, and introduce a fair taxation system where non-filers cannot evade their obligations. He warned that if Pakistan continues to prioritize short-term revenue collection over long-term stability, it will only deepen the country’s economic crisis. He concluded by emphasizing that Pakistan needs stable and predictable economic policies that foster growth rather than catering to IMF directives.
With the government under increasing pressure to boost revenue, tax policy experts warn that failing to address these deep-rooted flaws could further weaken Pakistan’s already fragile economy, leading to an even greater fiscal crisis in the near future. He concluded that the Pakistan Tax Bar Association has always been a strong advocate for fair taxation and the empowerment of taxpayers.
