Islamabad, June 26, 2025 – In a bold and unprecedented move, the government has armed the Federal Board of Revenue (FBR) with new powers to crack down on unregistered sales tax evaders, targeting their bank accounts under the amended Finance Bill 2025-26.
Starting July 1, 2025, individuals and businesses operating outside the sales tax net will face the threat of having their financial lifelines cut—temporarily, but forcefully.
Under the newly introduced Section 14AC of the Finance Bill, the FBR now has the authority to direct banks and financial institutions to suspend the operations of bank accounts belonging to unregistered sales tax persons. This action will be triggered when the Commissioner has sufficient reason to believe that an individual or entity is engaged in taxable supply of goods without being properly registered under sales tax regulations.
But it won’t come without warning. The FBR will offer three consecutive chances for the suspected evader to register voluntarily. Should the person fail to comply, the Commissioner can issue a written directive to temporarily suspend their bank account—for three working days. This suspension can be repeated two more times, each with a one-week gap in between, amplifying the pressure on non-compliant businesses.
This strategic update in the Finance Bill aims to close loopholes and push thousands of unregistered traders and vendors into the formal tax system. Previously, enforcing sales tax compliance among defaulters had proven difficult without such financial enforcement tools.
Officials say the goal is not merely punitive but reformative—nudging unregistered individuals toward compliance without paralyzing business activity entirely. However, the message is loud and clear: operating outside the sales tax net will now carry real consequences.
This aggressive move underscores the government’s renewed resolve to broaden the tax base and increase revenue collection, especially as Pakistan navigates economic reforms. For unregistered businesses, the countdown has begun. Register or risk losing access to your own money—three days at a time.