KARACHI, August 8, 2025 — In a stunning fiscal triumph, the Large Taxpayers Office (LTO) Karachi has unleashed its enforcement might, recovering a jaw-dropping Rs4 billion in Capital Value Tax (CVT) from foreign assets during the 2024-25 fiscal year.
This dazzling achievement eclipses last year’s Rs3.85 billion haul and sends a powerful message: hidden wealth abroad is no longer beyond the government’s reach.
According to sources, June alone witnessed an electrifying 77% surge in CVT collection, as LTO Karachi raked in Rs137 million — a sharp climb from Rs77 million in the same month of 2024. The driving force behind this surge is the relentless pursuit by the Automatic Exchange of Information (AEOI) Zone, a dedicated arm of LTO Karachi tasked with tracking Pakistanis who own undisclosed foreign assets. Through aggressive case reshuffling and forensic audit scrutiny, the zone has tightened the noose on tax evaders with unprecedented precision.
The CVT, introduced under the Finance Act, 2022, is laser-focused on taxing high-value possessions — from luxury vehicles on Karachi’s roads to sprawling estates and financial holdings overseas. Section 8 of the Act lays out its reach:
1. Motor Vehicles in Pakistan with engines above 1300cc, or electric vehicles with battery capacity exceeding 50 kWh, face a 1% CVT on their assessed value.
2. Foreign Assets of resident individuals valued above Rs100 million are slapped with a 1% CVT, calculated in Pakistani rupees using the State Bank’s official exchange rate.
3. Special Assets designated by the Federal Government can attract up to a 5% CVT.
For foreign assets, the tax bite applies to directly owned, indirectly held, or beneficially enjoyed wealth abroad. When original cost records are murky, fair market valuation becomes the yardstick. Inland Revenue officers are empowered to recover unpaid CVT — plus penalties — holding individuals personally liable under the strict provisions of the Income Tax Ordinance, 2001, and its allied rules.
With Karachi emerging as the nerve center of Pakistan’s tax enforcement drive, LTO Karachi’s crackdown on foreign assets is reshaping the revenue landscape. This bold offensive not only swells the national exchequer but also signals a new era where offshore holdings are no longer a safe haven. The message is clear: for those hiding assets overseas, Karachi is watching — and collecting.