Lifestyle scrutiny is just the right move

Published March 6, 2026 Updated March 6, 2026 09:45am

THE Lifestyle Monitoring Cell (LMC), established recently by the Federal Board of Revenue (FBR), is said to have detected undeclared assets worth approximately Rs12.3 billion in 38 cases, where influential tax evaders openly displayed lavish lifestyles on social media. The cell has identified this hidden wealth by using open-source intelligence and social media in just three months.

In many such cases, the declared income was negligible compared to the displayed assets. Individuals have been identified who own billions worth of foreign luxury cars in large numbers, but they pay almost zero tax.

The LMC initiative indicates that the FBR wants to determine people’s spending patterns, match them with their latest tax and wealth declarations, and ascertain whether tax fraud has occurred.

International experience shows that methods of estimating income based on expenditure implemented in various forms in different countries have proven effective in uncovering hidden wealth, especially undeclared income. The FBR’s decision to use lifestyle patterns and spending habits is certainly a positive and commendable step towards strengthening tax enforce-ment and curbing tax evasion.

However, relying solely on social media has its limitations. Although the cell’s initial results are noteworthy, they only touch the surface of the country’s informal and untaxed economy. The scope of this exercise needs to be expanded to include those millions of people about whom FBR authorities themselves claim to already have lifestyle data.

The government must digitise the entire economy. All purchases should be made through banks instead of cash. Records of agricultural, industrial and business properties in the country should be digitised so that benami (anonymous) properties worth billions may be traced. Currently, ill-gotten and tax-evaded properties are routinely purchased in the names of relatives and servants. Digitised records would identify all such individuals who are unemployed themselves, but have properties worth billions in their names.

This single step could expose corruption, looting and income from illicit means, effectively ending corruption. In this country, even low-level government employees own luxury cars, lands as well as properties. Their children study in expensive schools, and they are members of private clubs. Yet, they remain outside the tax net.

The FBR should investigate records of expensive schools, wedding halls, vehicle purchases and property registrations, and digitise them so that the tax net can be expanded and the heavy tax burden on employees and lower classes can be reduced. Expanding the tax base would bring a surprising increase in national revenue, eliminating the need for agree-ments with the International Monetary Fund (IMF) or any other international institution.

It is beyond doubt that no government can fix the economy without fundamental changes in the tax and accountability system, transparency and strict inquiry mechanisms. To stop poverty, destitution, ignorance, unemployment, insecurity and the trend of educated youth leaving the country, the country’s economy must receive timely and correct treatment for the chronic disease it is suffering from. This will increase public trust in the system.

Tariq Majeed
Hyderabad

Published in Dawn, March 6th, 2026

Opinion

Editorial

On unstable ground
Updated 06 Mar, 2026

On unstable ground

PAKISTAN’S economic managers repeatedly tout improvements in macroeconomic indicators, including rising foreign...
Divide et impera
06 Mar, 2026

Divide et impera

AS if the high loss of life in Iran, regional escalation and economic turbulence caused by the US-Israeli aggression...
New approach needed
06 Mar, 2026

New approach needed

WITH one World Cup campaign ending in despair, Pakistan began to plan for the start of the cycle of another by...
Collective wisdom
05 Mar, 2026

Collective wisdom

IN times like these, when war is raging in the neighbourhood, it is important for the state to bring on board all...
Economic impact
Updated 05 Mar, 2026

Economic impact

The Iran-linked instability highlights the fact that Pakistan’s macroeconomic resilience remains fragile.
Shrouds of innocence
05 Mar, 2026

Shrouds of innocence

TWO-and-a-half years of relentless slaughtering of Palestinian children, with complete impunity and in the most...