Islamabad: The federal government is expected to incorporate the Tax Laws (Amendment) Bill, 2024, into the upcoming Finance Bill 2025-26, introducing tougher restrictions on economic transactions carried out by non-filers of income tax returns, Business Recorder reported.
The move is aimed at enhancing documentation and broadening the tax net, particularly by curbing high-value financial activity by individuals who have not filed returns. The centerpiece of this effort is Section 114C of the amendment bill, which will limit non-filers’ ability to participate in key transactions.
However, the Federal Board of Revenue (FBR) has not yet developed the necessary technological infrastructure to fully implement Section 114C. Earlier this year, FBR Chairman Rashid Mahmood Langrial requested the National Assembly Standing Committee on Finance for a two-month window to complete the required updates to the FBR’s online systems.
In February 2025, the committee agreed to defer implementation of the section until the FBR could demonstrate a fully functional and user-friendly system capable of enforcing the new restrictions.
Former Minister of State for Finance, Ali Pervaiz Malik, underscored during the session that the deferment would not slow efforts to document wealth and penalize non-compliance. He emphasized that Pakistan’s tax regime could no longer rely on non-filers as a passive source of revenue without legal accountability.
According to officials, the FBR already has access to comprehensive data on immovable property transactions and will continue targeting non-filers based on this information. The Standing Committee has asked the FBR to present a live demonstration of the new system before any further decisions on the bill are made.
In preparation, the FBR is collaborating with the National Database and Registration Authority (NADRA), provincial excise departments, and land authorities to ensure the new controls are effectively integrated across platforms.
FBR Chairman Langrial clarified that the restrictions under Section 114C will not apply to transactions involving public companies or non-resident individuals. He urged the Revenue Division to finalize the system and present it to the committee before the Finance Bill is tabled in June 2025.
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