ISLAMABAD: The PML-N government’s talk of bringing the rich into the tax net has failed to produce any noticeable results as only 230 people have declared their gross income of over Rs100 million in a population of over 180m.

What is particularly shocking is that the number of taxpayers who filed under the highest income bracket (gross income over Rs100m) this year has fallen drastically; over 11,000 people had filed in tax year 2012.

The average tax paid in this category ranges between Rs22m up to a maximum of Rs77m.

Overall, the total number of people who filed their tax returns in 2013 stood at over 800,000, as against 711,940 people in 2012.

Dawn is in possession of the data submitted by taxpayers online with the Federal Board of Revenue (FBR) for tax year 2013. This data does not include those returns filed manually by taxpayers.

According to this data only 160 people have declared their income between Rs50m to Rs100m, which also shows that the elite in this country are not paying their fair share of taxes.

For the next tax bracket, the number of taxpayers who declared their income between Rs30m to Rs50m is 275, followed by 915 taxpayers who declared their income between Rs15m to Rs30m, respectively.

The number reduces to a mere 2,000 when it comes to people who paid more than Rs2m to Rs3.6m as annual tax. And only 3,070 taxpayers paid up to Rs0.82m to Rs2m. Each of them contributed less than Rs2m to the government. This is less than the amount that one would need to purchase a 1,600cc car.

Only 8,570 people paid tax in the range of Rs362,500 to Rs820,000, followed by 30,600 taxpayers who paid Rs95,000 to Rs362,500 as annual tax in 2013.

With the fall in the incidence of gross income the number of taxpayers witnessed substantial increase. As many as 114,000 people declared their income in the range of Rs0.5m to Rs1.5m. In this category, people paid income tax from Rs10,000 to a maximum of Rs95,000 as annual tax.

And 57,895 taxpayers have declared their income up to Rs0.5m. Each of them contributed from Rs1,000 to Rs4,000 as annual tax, with the second highest number of people who fall in this lowest slab.

Those taxpayers who filed their returns in 2013 but declared nil income come to 74,000. This means that either these people have evaded paying tax or have concealed their income which could not be traced.

Similarly, more than 2,000 people have declared losses in their tax returns.

More than 3.3m taxpayers exist on the tax roll, but the filing of returns is just 24pc, showing poor compliance where filing is concerned.

FBR official spokesman Shahid Husain Asad told Dawn that more than 505,000 people have filed manual returns with the regional tax offices. He said that only 292,370 people have e-filed tax returns.

Most tax evaders are guilty of not completing the paperwork; tax is usually deducted at source when people are paid. But it is still mandatory for taxpayers to file their returns and wealth statements.

People earning more than Rs500,000 a year may be punished for not filing the returns. The penalty starts from Rs5,000 and can go up to 25pc of the tax payable in a year. Tax officials can also force the guilty person to pay up the due tax.

As per income tax law, filing of tax returns is mandatory for all those people who posses a 1,000cc car or a plot of 250 square yards or 2,000 square feet flat in any municipal corporation in the country.

Imaginary taxpayers?

What is particularly troubling is the fact that the ranks of taxpaying citizens seem to be shrinking every year. Statistics show that 1.44 million people filed their returns in 2011. Yet in 2012 there were only over 700,000 taxpayers in the country who the FBR could trace to their homes or workplaces.

The filing of tax returns was reported at 1.7 million in tax year 2010. Does this mean that the missing numbers are imaginary taxpayers?

Tax expert Dr Ikramul Haq attributed the poor compliance to the FBR’s inefficiency. He said it was a failure of the tax-collection body that it was unable to make all those with taxable income comply with filing returns.

Dr Haq said that three categories — lawyers, chambers of commerce and doctors were added to the list of mandatory tax return filers. As per law, he said there are more than one million lawyers and doctors who are supposed to file returns.

He also observed that the numerical strength of the FBR did not enhance its performance.

As a comparison, only 0.4pc of the population pays taxes in Pakistan, as against 4.7pc in India, 58pc in France and 80pc in Canada.