Karachi, June 29, 2025 – In a powerful move aimed at tightening the noose around tax evaders, the Federal Board of Revenue (FBR) is all set to unleash a bold and unprecedented enforcement measure starting July 1, 2025: blocking bank accounts of individuals and entities who fail to register for tax despite making taxable supplies.
Under the Finance Act, 2025, the government has inserted a groundbreaking new provision — Section 14AC — into the Sales Tax Act, 1990. This new section grants sweeping powers to the FBR to suspend and even permanently block bank accounts of non-compliant taxpayers. The crackdown is aimed at those who deliberately dodge tax registration while continuing to conduct taxable business.
According to Section 14AC, the Commissioner Inland Revenue can take action when it is believed that a person is engaged in taxable activity without registration. After issuing three formal notices giving the individual a chance to register, the FBR will initiate a series of account suspensions. First, the person’s accounts will be frozen for three working days, and if non-compliance continues, two more suspensions will follow with a week’s interval. If the individual still refuses to comply, the FBR will permanently block all bank accounts associated with that person.
This bold maneuver signifies a turning point in Pakistan’s tax enforcement strategy. The FBR is making it crystal clear — if you are in business, pay your due taxes or risk losing access to your bank accounts. These actions will apply to all accounts held with scheduled banks, financial institutions, and commercial banks.
To ensure due process, affected individuals can appeal the FBR’s decisions within 30 days to the Chief Commissioner Inland Revenue. However, the power to lock down accounts remains firmly with the FBR until the person registers for tax and the Commissioner lifts the ban within two working days.
This high-stakes measure is expected to bring thousands of non-compliant businesses into the tax net. The FBR’s message is loud and clear: Evading tax registration is no longer an option — your bank accounts are on the line.