In a bold move to enforce tax compliance, the Federal Board of Revenue (FBR) has announced it will freeze the bank accounts of non-filers during the fiscal year 2025-26. FBR Chairman Rashid Mahmood Langrial shared this during a session of the National Assembly’s Standing Committee on Finance
Formal Notices and Strict Action
Langrial said formal notices will be issued to businesses and individuals who are not registered for sales tax. If they fail to comply, the FBR will freeze their bank accounts. However, accounts will be restored within 48 hours of registration. This policy aims to bring unregistered but high-earning businesses into the tax net.
Sales Tax Evasion Under Scrutiny
FBR officials highlighted that many income tax filers are still evading sales tax. Karachi alone has several factories with multiple industrial meters making billions in unregistered sales. The FBR now targets large-scale manufacturers rather than small traders or cottage industries.
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Debate on Enforcement Measures
Committee member Usman Ahmed Mela criticized the idea of sealing properties, calling it too harsh. Langrial clarified that such steps are aimed at large manufacturers, not small retailers. Meanwhile, Chairman Syed Naveed Qamar questioned the FBR’s aggressive methods, saying, “First electricity and gas are cut, now bank accounts?”
Unregistered Operators Exploit Loopholes
FBR shared that many businesses, especially in Karachi, dodge taxes by frequently changing locations. Large-scale setups often operate from a single plot temporarily before moving on, avoiding consistent monitoring.
Proposal for Higher Sales Threshold
Committee member Mirza Ikhtiar Baig suggested raising the mandatory registration threshold from Rs8 million to Rs10 million due to inflation. Langrial accepted the proposal and confirmed the FBR would implement the change. He revealed that nearly two-thirds of manufacturing units remain unregistered and proposed a six-month grace period with no sales tax collection for new registrants.
This policy marks a significant shift in Pakistan’s tax enforcement strategy, aiming to widen the tax base without burdening smaller traders.
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