Islamabad – July 23, 2025 — Pakistan’s aggressive push to expand its tax base may be costing more than it’s collecting, warns a hard-hitting new report by the Asian Development Bank (ADB). The findings paint a troubling picture of misplaced priorities, mounting administrative burdens, and a tax system in dire need of simplification and reform. The ADB’s deep dive into Pakistan’s tax machinery reveals a stark truth: despite a surge in the number of tax filers over the past decade, the country’s income tax-to-GDP ratio has barely budged. In simpler terms, Pakistan is bringing more people into the tax net—but they’re barely paying anything. 🎯 A Lesson for Developing Nations The ADB cautions other Developing Member Countries (DMCs) against blindly following Pakistan’s example. “Expanding the tax base without addressing compliance and simplification doesn’t work,” the report states. “Pakistan offers a cautionary tale.” The study groups Pakistan alongside countries like Rwanda, South Africa, and Uganda, where expanded tax filing failed to produce any meaningful bump in revenue. A growing list of tax filers, it turns out, does not automatically translate into a growing pile of tax money. “The tax system is bloated with noncompliant filers who report zero or negligible income,” the ADB notes. 📉 Tax Filing: Quantity Over Quality? The raw numbers might look promising on paper. From 2007 to 2021, the number of tax filers more than tripled. But here’s the kicker: a substantial chunk of these new filers either declared no income or dodged meaningful contributions altogether. Real tax revenue, adjusted for GDP, has hovered stubbornly between 3% and 4%—unchanged for over a decade. So, what’s gone wrong? According to the ADB, Pakistan’s tax authorities have focused too heavily on swelling the ranks of filers instead of strengthening compliance among existing taxpayers. Without addressing the roots of noncompliance, the system has simply expanded in size—not strength. 💰 The Rich Pay, The Rest File and Forget Another shocking revelation: Pakistan’s income tax is overwhelmingly paid by the top 1% of earners. Figures show that…