Gohar Ijaz calls for tax net expansion using bank-data-based smart policy

The former caretaker federal minister for commerce and a prominent name in Pakistan’s textile industry, Gohar Ijaz, has emphasised that enforcement actions alone are not sufficient for sustainable tax revenue generation. A clear and long-term tax policy is necessary to bring untaxed sectors into the tax net.

In a statement on Tuesday, Gohar Ijaz acknowledged the Federal Board of Revenue's (FBR) exceptional performance during the fiscal year 2024–25, stating that the FBR collected a historic Rs11,700 billion in taxes.

According to the 24NewsHD TV channel, Gohar Ijaz commended the FBR Chairman and his team for their tireless efforts, noting a 26% increase in revenue collection despite inflation falling below 5% and a stable Pakistani rupee.

Reflecting on his earlier remarks made on June 19, Ijaz had proposed that the FBR should use existing banking data to broaden the tax base.

According to him, Pakistan presents a striking disparity: only 5.9 million tax filers exist within a workforce of 71 million, amounting to just 8.4%.

Meanwhile, banks in Pakistan hold 177 million accounts belonging to 137 million unique individuals—representing 60% of the adult population—and host Rs32.7 trillion in deposits as of May 2025.

He pointed out that all of these accounts come with comprehensive Know Your Customer (KYC) data, making it feasible to trace financial activity, transaction history, and account profiles.

This presents an opportunity for smart governance, said Ijaz, stressing that Pakistan's revenue ambitions should focus on onboarding the untaxed, financially active population rather than overburdening the existing 5.9 million compliant taxpayers.

He concluded that real progress lies in identifying and integrating the 131 million untaxed bank account holders into the formal economy, using the tools already in the government’s possession.

Reporter: Waqas Azeem