The Federal Board of Revenue (FBR) has failed to recover FBR Rs. 118 Billion in super tax from large taxpayers over the last two years, according to the Auditor General of Pakistan’s Audit Report 2024-25.
The report highlighted serious weaknesses in tax assessment and system operations. It said these flaws caused major revenue losses for the government.
According to the audit, FBR Rs. 118 Billion remained unpaid because the tax return system could not calculate super tax correctly. The system does not include all taxable income sources while determining tax liability.
The report showed that 527 large taxpayers did not pay the required super tax. This created a shortfall of Rs. 117.78 billion, which has been rounded up as FBR Rs. 118 Billion in the report summary.
The audit also found serious irregularities in 19 FBR field formations. These issues were linked to poor tax assessment and weak recovery processes.
The Auditor General said such system flaws have caused under-assessment for several years. The report noted that this problem has appeared in past audits as well.
This shows that the issue has not been fully resolved despite repeated warnings.
In response, the FBR said it has started legal proceedings for unpaid taxes worth Rs. 71.21 billion. The department said recovery efforts are underway in these cases.
The tax authority also informed auditors that another Rs. 46.56 billion is stuck in court cases. These legal delays have slowed the recovery process.
The Departmental Accounts Committee (DAC) has now directed the FBR to speed up legal proceedings. It also asked the department to submit a compliance report after completing the process.
The Auditor General recommended major upgrades in the FBR’s return filing system. The goal is to improve automatic tax calculations and reduce future losses.
Experts believe fixing these weaknesses could help improve tax collection. It could also strengthen trust in the country’s revenue system.
In other news read more about FBR Faces Criticism in Senate Over Tax Collection Performance
The FBR Rs. 118 Billion recovery gap has once again raised concerns over Pakistan’s tax enforcement and financial accountability.
