Islamabad: The federal government has empowered the Federal Board of Revenue (FBR) to take stricter action against non-filers under the newly approved Finance Bill 2025, which comes into effect on July 1.
As part of the government’s broader strategy to improve tax compliance and documentation, the FBR will now be able to forcibly register individuals who are liable to pay taxes but fail to voluntarily register.
Under the new amendments to the Sales Tax Act, designated FBR officers or Inland Revenue Commissioners can initiate compulsory registration of such individuals after conducting an investigation. Two new clauses — 14AC and 14AD — have been introduced specifically to penalise those evading tax registration.
Clause 14AC authorizes the Inland Revenue Commissioner to freeze the bank accounts of individuals who have not registered despite being eligible. This freeze will remain in place until the individual complies with the registration requirements.
The government has described these changes as essential to strengthening tax enforcement and reducing the country’s reliance on indirect taxation. FBR officials said these measures are aimed at broadening the tax base and bringing more people into the formal economy.
The Senate Standing Committee on Finance has also backed the enforcement mechanism, signaling broader political support for stronger tax reforms. These new powers are part of ongoing efforts to enhance revenue collection and address chronic issues of tax evasion in Pakistan. Finance Minister Muhammad Aurangzeb recently stated that penalties for non-filers were already increased last year, and this year’s Finance Bill builds on that momentum.
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