Pakistan’s tax filing data for the fiscal year 2024-25 has revealed some surprising figures. Despite 5.9 million people filing tax returns, a significant 43.3% of them reported zero taxable income. This means that nearly half of the filers either had no taxable earnings or used exemptions to avoid paying taxes.
Among the tax filers, only 3,651 individuals declared an income of more than Rs. 100 million. More strikingly, just 12 people in the entire country reported wealth exceeding Rs. 10 billion. This highlights a sharp wealth concentration among a tiny fraction of the population.
The total number of tax filers has also dropped from 6.8 million in 2023 to 5.9 million this year. Among these, 5.8 million were individual filers, 104,269 were part of Associations of Persons (AOPs), and 87,900 were companies. A key concern is that out of 300,000 industrial electricity connections, only 87,000 companies actually filed tax returns, raising questions about tax compliance in the corporate sector.
Looking at different income groups, 1.3 million people declared earnings between Rs. 1 million and Rs. 5 million. Meanwhile, 97,326 individuals reported income between Rs. 5 million and Rs. 10 million. Further narrowing down, only 49,359 people had incomes between Rs. 10 million and Rs. 50 million, while a mere 4,370 individuals earned between Rs. 50 million and Rs. 100 million.
Despite all the tax returns filed, the total declared income in Pakistan exceeded Rs. 10 trillion. However, the net tax collected stood at only Rs. 2.9 trillion, indicating that a large chunk of income remains untaxed or is shielded through legal loopholes.
This data raises concerns about tax compliance, wealth inequality, and the efficiency of the tax collection system in Pakistan. With a significant portion of potential taxpayers either not filing or declaring zero income, the government faces a major challenge in broadening the tax base and ensuring fair contribution from all economic segments.
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