ISLAMABAD: The country’s top tax machinery is confronted with a big dilemma of nil-filers, which has reached an alarming level of nearly 39 per cent of total income tax returns in the tax year 2025, Dawn has learned from official sources.
This presents a big challenge for the government in identifying individuals not paying their taxes, with 2.262 million out of 5.912 million filed up to Oct 31, potentially concealing their taxable income. This means that only 3.650m taxpayers declared incomes in their returns for tax year 2025 (TY25).
The pattern of nil-filers are across the three main categories — individuals, associations of persons (AoPs) and the corporate sector. The nil returns are submitted for one-time financial transactions or to take advantage of lower tax rates for placement on the Active Taxpayers List (ATL).
Concerns are mounting within the FBR that Pakistan’s income tax system is failing to capture the true wealth of its citizens, as approximately half of taxpayers continue to declare nil incomes far below the lavish lifestyles they maintain.
Zero income with lavish lifestyle exposes weak enforcement as millions stay on the rolls without paying a rupee
In TY25, the number of nil-filers, both salaried and non-salaried individuals, remained significantly high. Out of 5.805m total individual returns filed, 2.206m were nil-returns, declaring no taxable income.
This means 38pc of all individual filers fell into the nil-filer category, highlighting a growing trend of non-contributory filings and raising concerns about the quality of the tax base. In TY24, almost a similar trend of nil-filers was recorded, which shows consistency of the trend.
