Money

FBR extends deadline to file tax returns till Dec 8

The Federal Board of Revenue has extended the deadline for filing income tax returns of the fiscal year ending June 30, 2020 by more than two months, a notification said on Wednesday.

Every year, individuals, associations of persons, and companies are required to submit their income tax returns with the FBR by end of September. However, the deadline has now been extended till December 8, the FBR said adding that no further extension in the deadline would be granted.

The FBR didn’t specify the reason for this extension but there were reports that the national exchequer didn’t upload the required forms until the second week of September and the extension was inevitable. For tax year 2018, the FBR extended the date multiple times and stretched it over a year beyond the first deadline of September 30. It published taxpayers’ directory up to fiscal year 2018 earlier this month, showing a lag of at least one year.

According to provisional estimates, the government will collect Rs4.7 trillion in federal taxes in the latest fiscal year and have a budget deficit of Rs3.3 trillion or 8% of the GDP.

High expenditure and low revenue has been a big challenge for the government, which ends up borrowing money to plug this gap. The country has one of the lowest tax-to-GDP ratios (approximately 15%) because of tax evasion. For fiscal year 2018, the tax authority selected 12,553 cases for audit of which more than 10,000 are related to income tax and 2,000 to sales tax.

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