Distinction between “Paying the tax” and “Filing tax return”: There are an insane amount and types of taxes such as annual road token, GST, income tax, customs, levy, octroi, property tax, withholding tax and many many more.
Everybody is paying tax, some are paying direct tax (income tax, property tax, capital gain tax), most are paying indirect tax because practically anything you buy has built-in tax (applied/withheld at source) such as milk, eggs, petrol, diesel, toothpick, sewing needle each and everything has multiple types of taxes on it.

Filing the tax returns is altogether different story than paying the taxes. It does not involve money, it is just a paperwork. Non-filers are thought to be the more patriotic Pakistanis because they pay around twice the tax than filers. And nonfilers cannot claim a “tax refund” either. So it is double patriotism and it is logical for the government to want more and more people to be nonfilers.

Per income tax law, anybody who owns car greater than 1000cc should file the return regardless of what they are earning. If they are earning less than income tax bracket, they won’t pay any tax, but still compulsory to file the return. The result is as soon as you own a vehicle with >1000 cc engine under your name, the government employees have yet another reason to harass you whether you are a filer or nonfiler. So to protect themselves from the random episodes of harassment, even the big businessmen are using 660 cc nowadays. If you have an old Mazda 1300 worth 60,000 rupees you could be a target but not if you have a new 17 lac Alto.

That is true, many people avoid large engine cars because of fear of consequences of higher tax bracket. However, what do you mean by filing returns? Of course tax needs to be paid on even a 660CC car, my father just paid PKR 2,700 or something of the sort about a month ago.
By the way, Pakistan is the only country where tax system is an oddity in its own way. People like dhaba and cart owners or scrap dealers are doing a roaring business and still not falling under tax net. In contrast, a person earning PKR 650,000 annually is subjected to tax.