Karachi, June 21, 2025 – Foreign investors operating in Pakistan have voiced strong opposition to the sweeping powers of arrest proposed for Federal Board of Revenue (FBR) officials under the Finance Bill 2025-26.
The Overseas Investors Chamber of Commerce and Industry (OICCI), which represents over 200 multinational companies from more than 30 countries, has raised alarm over provisions that could severely undermine business confidence, especially among foreign investors.
The concerns center around amendments to Section 37AA of the Sales Tax Act, 1990, which propose to grant Inland Revenue officials wide-ranging powers to arrest and prosecute individuals suspected of tax violations—without robust checks and balances. In a letter addressed to Finance Minister Muhammad Aurangzeb, the OICCI expressed apprehension over the potential misuse of such powers, cautioning that it would result in harassment of legitimate businesses and severely damage the country’s investment climate.
Abdul Aleem, Chief Executive and Secretary General of OICCI, stated that this unilateral move—introduced without meaningful consultation—has already shaken the confidence of both local businesses and foreign investors. “Our members, who contribute significantly to Pakistan’s economy, are extremely concerned. Such proposals, without clear safeguards, portray Pakistan as an unpredictable and high-risk destination for investment,” he said.
While acknowledging the timely intervention by Prime Minister Shehbaz Sharif and key parliamentarians, the OICCI urged the government to ensure that no such powers are granted without detailed scrutiny and consultation with business stakeholders. The Chamber recommended that if the arrest clause must be retained for extraordinary cases, it should include strict preconditions, such as prior written approval from the FBR Chairman to prevent misuse.
The OICCI emphasized that maintaining investor confidence is vital for Pakistan’s economic recovery and growth. Arbitrary and unchecked enforcement powers not only threaten the ease of doing business but also risk tarnishing Pakistan’s image among foreign investors seeking a stable and transparent regulatory environment.
The Chamber has also raised its concerns directly with FBR Chairman Rashid Mahmood Langrial, urging a complete review and possible withdrawal of the proposed amendments. It stressed that building trust and ensuring predictability are essential elements if Pakistan hopes to remain an attractive destination for foreign investors amid growing regional competition.
In conclusion, the OICCI reaffirmed its commitment to working constructively with the government and reiterated that any move impacting the business environment should be made through transparent dialogue and consensus, rather than through the imposition of unchecked enforcement powers.