Only 18,109 non-filers file returns in response to 70,607 notices

The level of non-compliance is evident from the fact that only 18,109 non-filers and stop-filers of income tax returns filed income tax returns for tax year 2009 in response to 70,607 notices issued by the department, reflecting irresponsible attitude of 52,489 registered persons. According to FBR latest data on return filing compiled on Tuesday, the FBR detected around 176,831 non-filers and stop-filers of income tax returns for tax year 2009.
Out of these 176,831 non-filers, the department issued notices to 70,607 non-filers/stop-filers during tax year 2009. Resultantly, only 18,109 filed returns in response to the notices to the registered persons issued under Income Tax Ordinance 2001.
The data further showed that the FBR had detected around 39,247 short-filers and null-filers of income tax returns for tax year 2009. Out of this, the department issued notices to 1,426 to the short-filers and null-filers of returns during the period under review. Interestingly, nearly 35 short-filers deposited tax in response to these notices during this period. The FBR recovered Rs 152.53 million as taxes including penalty/default surcharge from the return filers. However, compliance by only 35 short-filers was an alarming situation for the tax authorities.
According to sources, the above-mentioned data clearly indicates that the compliance level is extremely below the mark. The FBR has identified major areas of concern which are responsible for low level of compliance. There is something seriously wrong at the level of the field formations, which is reflected from the large number of non-filers. Similar trend was observed in case of registered persons who received notices during tax year 2009.
First, the field formations were unable to strictly monitor the process of serving notices to registered persons. Second, the taxation officers seemed to be unable to timely take enforcement actions to improve compliance. Third, the overall numbers of returns filed in respond to notices was extremely low. Fourth, the amount of tax paid along with the returns was too low. There is an immediate need to take penal action against the non-filers of returns for imposition of penalty and default surcharge on the non-compliant taxpayers, sources added.