FAISALABAD:
The Regional Revenue Office (RTO) Faisalabad has intensified efforts to widen the tax base by targeting retailers, wholesalers, distributors and traders amid a slowdown in export-related collections and stagnant import duty revenue, officials said.
Chief Commissioner RTO Dr. Shah Khan said while addressing media representatives that the authority is working to achieve an annual tax collection target of Rs 160 billion by June 2026 despite the new financial pressure associated with regional geopolitical tensions since late February 2026.
He said the ongoing Iran-US-Israel conflict has started to affect trade flows, with export-related levies and import-related taxes showing a noticeable slowdown from the second week of April.
He pointed out that the full trade cycle affects tax collection with a lag of almost 45 days to two months and the current downturn is now reflected in withholding taxes, VAT, import income tax and export-related tax flows.
Dr. Shah Khan said earlier import and export sectors showed growth of 15% to 20%, but this momentum has now stalled, putting pressure on revenue targets.
He added that in response, the tax administration is focusing on alternative revenue streams, including audit closures, recovery of outstanding dues, stocktaking exercises and increased field visits across sectors such as textiles, processing units, hospitals and tents.
He said Faisalabad’s average monthly tax collection stands at about Rs.14 billion, with nearly 60% coming from income tax, including domestic and import-related sources, while the rest is contributed through sales tax and federal excise duty.
However, he noted that large industries like sugar and cement contribute their taxes in other jurisdictions due to production sites, which affects local persons.
Dr. Shah Khan also pointed out issues of under-invoicing and mis-reporting in textile and processing sectors, stating that field teams are actively monitoring discrepancies between declared data and actual usage of raw materials.
He said enforcement teams regularly conduct inspections and audits to curb tax evasion and ensure compliance.
Widening the tax net, the chief commissioner said the department is using multiple data sources including property records, vehicle registrations, club memberships and withholding tax data under section 236G and 236H to identify potential taxpayers.
He said CNIC-based data is being used to register new taxpayers and enforce return filing through notifications, after which individuals become part of the formal tax system and subject to audit.
“At the moment the burden is disproportionately on the existing taxpayers, but the aim is to bring more contributors into the system,” he said.
