ISLAMABAD – A damning Auditor General of Pakistan report for FY2024-25 has revealed a Rs789.92 billion tax gap, exposing deep-rooted weaknesses in tax collection, enforcement, and fiscal governance.
The breakdown shows income tax losses of Rs480.19bn, sales tax shortfalls of Rs212.12bn, customs inefficiencies worth Rs40bn, and Rs615m gaps in excise duties.
The report further flagged Rs57bn in discrepancies between revenue records maintained by the FBR, State Bank, and AGPR, raising concerns about the reliability of official fiscal data.
Among the most alarming findings:
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Rs167.88bn lost in under-collected super tax
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Rs149.57bn from false or inadmissible expense claims
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Rs62.32bn in unrecovered tax demands
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Rs54.19bn from concealed income
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Rs35.97bn in hidden sales
The sales tax system was found riddled with fraud, including fake invoices from blacklisted taxpayers, causing losses of over Rs123bn. Customs operations too faced chronic inefficiencies, with losses linked to confiscated goods, undervaluation of imports, pending adjudications, and irregular auctions.
The report concluded that Pakistan’s fiscal governance suffers from weak enforcement, poor auditing practices, and systemic loopholes that allow massive leakages.
Analysts warn that unless urgent reforms are undertaken, Pakistan will continue to bleed billions in potential revenue—deepening its fiscal crisis and reliance on external borrowing.