ISLAMABAD (PEN) : The Federal Board of Revenue (FBR) has proposed empowering tax authorities to freeze or even permanently close bank accounts of businesses not registered under sales tax and other tax laws—a move aimed at broadening the country’s narrow tax base.
Sharp Power to Enforce Registration
Under the proposed Finance Bill 2025–26, tax commissioners may issue orders directing banks to block accounts of individuals or entities who remain unregistered. Accounts would be reinstated upon registration—or within a two‑day window—after which affected parties can appeal to the Chief Commissioner of Inland Revenue within 30 days (
The draft also extends restrictions beyond banking. It suggests halting property transfers, sealing business premises, seizing movable assets, and even appointing receivers to manage non‑compliant businesses. These actions would follow formal notices and a due‑process hearing before a committee composed of FBR officials and trade representatives (
Driving the Tax Net Drive
The FBR estimates that, of approximately 300,000 industrial units nationwide, only 30,000–35,000 are formally registered—leaving roughly 90% operating outside the tax net . FBR Chairman Rashid Mahmood Langrial emphasised electricity theft alone costs the country Rs500–600 billion yearly, while many retailers and traders continue to shirk registration.
“If they still fail to register, their bank accounts can be suspended, but reactivated within two days after compliance,” he told the National Assembly Standing Committee on Finance
Safeguards and Appeals
The bill includes procedural safeguards: freezes would only be lifted upon proven tax registration, and individuals may file appeals to the Chief Commissioner. Furthermore, public notices and transparent hearings are required prior to enforcement
Balanced Measures to Enhance Compliance
FBR Chairman Langrial acknowledged the government’s shift toward incentives, stating existing tax rates remain burdensome and compliance is weak. He affirmed that enforcement will be matched with facilitative reforms and reduced sales tax on essential items—including a 10% levy on imported solar panels approved by the finance committee, down from 18% .
Finance Minister Muhammad Aurangzeb articulated the administration’s stance clearly: “The focus now is on bringing people under the tax net through reforms and effective enforcement,” eliminating tax exemptions and amnesty schemes of the past
Fine‑Tuning the Legislation
The Finance Bill also remains under review to incorporate clarity around “ineligible persons,” those barred from opening bank accounts, purchasing vehicles over 800 cc, or transferring property unless they’ve filed tax returns for the prior year ([geo.tv][4]). The FBR will collaborate with the State Bank of Pakistan and banks nationwide to enforce these provisions once the legislation is enacted.
Bottom line: Pakistan’s new Finance Bill gives tax authorities strong tools to enforce registration, including freezing banking privileges, restricting property and vehicle transactions, and sealing premises. These tough measures, paired with reform‑oriented incentives like lower sales tax on solar imports, aim to draw businesses into the formal tax ecosystem and enhance economic transparency.
