Pakistan’s tax authority is preparing to expand artificial intelligence checks on tax returns to identify undeclared income and assets, a senior official said this week, part of a push to increase revenues under an IMF-backed economic reform programme.
Pakistan has struggled to bring more economic activity into its tax system, leaving a narrow base of taxpayers and limiting the government’s ability to finance public services without borrowing. Stronger collection is a central objective of its reform commitments to the International Monetary Fund.
The Federal Board of Revenue (FBR) plans to cross-check declarations against property, banking, vehicle and other records. Following a pilot involving a limited number of income tax and sales tax returns, it intends to apply the models to income tax filings for the year ended June 2026 and subsequent sales tax returns, the official said.
“This time the system will leave nowhere to hide,” he told Arab News, requesting anonymity because he was not authorised to speak publicly. “It does not get tired and it does not miss a line. Our campaign this year says ‘FBR Sab Janta Hai’ (FBR knows everything). With this system, that is no longer just a slogan.”
According to the official, the models will check returns against tax-law requirements, compare declarations with those of similar taxpayers and identify inconsistencies with information obtained from other sources. A flagged discrepancy would require examination but would not, by itself, establish fraud.
“Returns flagged by the AI could be selected for audit, face assessment proceedings, or trigger compliance nudges asking taxpayers to correct their filings,” the official said.
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