How Pakistan is revving up a fight against tax dodgers

Pakistan faces a chronic economic crisis driven by a severe tax collection deficit, where only two to three percent of the population files income tax returns compared to nearly half of Americans. While 40% of the country lives below the poverty line, a wealthy elite frequently reports zero income, prompting the Federal Board of Revenue to launch "lifestyle monitoring" to track tax evaders via extravagant social media posts. This systemic failure stems from a massive informal cash economy, widespread corruption, and a lack of public trust in government services. Consequently, the tax burden falls disproportionately on a small "salaried class" taxed up to 35%, forcing the nation into a cycle of IMF bailouts. Experts like Akbar Zaidi and Amir Khan argue that until Pakistan digitizes its financial systems and reduces its dependence on cash, the government will continue to struggle with revenue shortfalls and a persistent trust deficit.