ISLAMABAD, April 17, 2025 — The Federal Board of Revenue (FBR) has taken a major step to enhance regional trade by issuing draft rules for the Uzbekistan-Pakistan Transit Trade (UPTT) mechanism. These regulations aim to formalize and streamline the movement of goods between Pakistan and Uzbekistan, promoting cross-border trade through efficient logistics and transparent customs procedures.
(more…)Tag: Federal Board of Revenue
The Federal Board of Revenue is Pakistan’s apex tax agency, overseeing tax collection and policies. Pakistan Revenue is committed to providing timely updates on the Federal Board of Revenue to its readers.
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Abetment in tax matters to be offence
Section 199 of the Income Tax Ordinance, 2001, updated up to June 30, 2021, now explicitly outlines that knowingly and willfully aiding, abetment, assisting, inciting, or inducing another person to commit an offense under the ordinance is a punishable offense, carrying the risk of a fine or imprisonment for a term not exceeding three years, or both.
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IR intelligence conducts two raids against tax evasion
ISLAMABAD: The Intelligence and Investigation of Inland Revenue (IR) has conducted raids in Lahore and Multan against entities involved in tax evasion, said a statement issued by Federal Board of Revenue (FBR) on Thursday.
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Tax laws amended to include digital payment
ISLAMABAD: Federal Board of Revenue (FBR) on Thursday said that tax law has been amended to include mode of digital payment.
To improve documentation, a new clause (la) has been inserted through Tax Laws (Third Amendment) Ordinance, 2021 in section 21 of the Income Tax Ordinance, 2001.
Previously payments under a single head account exceeding two hundred and fifty thousand rupees, made by any taxpayer were required to be made through crossed cheque or crossed baking instruments including digital payments.
Through this amendment, payments made by a company under a single head of account exceeding two hundred and fifty thousand rupees other than by digital means from business bank account of the taxpayer notified to the Commissioner under section 114A of the Ordinance shall not be admissible as deductions.
However, certain expenditures on account of utility bills, freight charges, travel fare, and payment of taxes and fines would continue to be admissible even though paid in cash or via traditional banking instruments.
The purpose behind this legislative enactment is to encourage digital payments and discourage traditional mode of transactions by the corporate sector in the first phase. However, owing to lack of total digital readiness by some corporate taxpayers, the corporate taxpayers are allowed to switch to this mode w.e.f. November 01, 2021.
In the intervening period they may use digital payments or continue with the existing procedure of making payments by a crossed cheque drawn on a bank or by crossed bank draft or crossed pay order or any other crossed banking instrument showing transfer of amount from the business bank account of the taxpayer.
The FBR further said that currently, any salary paid or payable exceeding twenty five thousand rupees per month has to be made through cross cheque or direct transfer of funds to the employee’s bank account under clause (m) of section 21 of the Ordinance.
In order to bring this provision in conformity with newly inserted clause (la) ibid, in case of payments against salary in excess of twenty five thousand rupees per month, the mode of digital payment has been added to the available modes referred to above.
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Prosecution for sharing unauthorized information
In a bid to strengthen the protection of sensitive taxpayer information and maintain the integrity of the tax system, the Federal Board of Revenue (FBR) has introduced stringent provisions under Section 198 of the Income Tax Ordinance, 2001.
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Employers flay new tax ordinance
KARACHI: President, Employers’ Federation of Pakistan, Ismail Suttar, has strongly condemned the promulgation of new tax ordinance without consultation of the relevant stakeholders.
The federal government introduced Tax Laws (Third Amendment) Ordinance, 2021, which was promulgated on September 15, 2021 through a presidential order.
In a statement, Ismail while criticizing the Federal Board of Revenue (FBR), termed the move irrational and unwelcoming because most transactions are carried out through post-dated checks, and without a grace period of at least 40 days the business community will not be able to adopt the digital mode.
“It is a total disaster and not the right way to bring the non-compliant sector under the tax net to meet the ambitious target of Rs5.5 trillion tax collection by pounding on the largely compliant corporate sector,” Ismail asserted.
On behalf of the member manufacturers and exporters, the EFP president has appealed for an immediate suspension of the new tax law ordinance until due approval by the industrialists.
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Prosecution for disposal of property
Section 197 of the Income Tax Ordinance, 2001, updated up to June 30, 2021, now explicitly outlines that individuals who, after receiving a notice from the Commissioner, engage in selling, mortgaging, charging, leasing, or otherwise dealing with the property to prevent its attachment, will be liable for prosecution.
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Obstructing tax officials punishable offence
Section 196 of the Income Tax Ordinance, 2001, updated up to June 30, 2021, explicitly declares that obstructing an income tax authority in the discharge of their functions is now a punishable offense.
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Prosecution for not declaring foreign assets
Section 195A of Income Tax Ordinance, 2001 explains the prosecution for not declaring foreign assets.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
Following is the text of Section 195A and 195B of Income Tax Ordinance, 2001:
195A. Prosecution for non-compliance with notice under section 116A.— Any person who, without reasonable excuse, fails to comply with a notice under sub-section (2) of section 116A; shall commit an offence punishable on conviction with imprisonment up to one year or with a fine up to fifty thousand Rupees or both.
195B. Prosecution for enabling offshore tax evasion.– Any enabler who enables, guides or advises any person to design, arrange or manage a transaction or declaration in such a manner which results in offshore tax evasion, shall commit an offence punishable on conviction with imprisonment for a term not exceeding seven years or with a fine up to five million Rupees or both.
(Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
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Prosecution for making false, misleading statements
Section 195 of Income Tax Ordinance, 2001 describes the prosecution for making false or misleading statements.
The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.
Following is the text of Section 195 of Income Tax Ordinance, 2001:
195. Prosecution for making false or misleading statements. — (1) A person who –
(a) makes a statement to an income tax authority that is false or misleading in a material particular; or
(b) omits from a statement made to an income tax authority any matter or thing without which the statement is misleading in a material particular,
shall commit an offence punishable on conviction –
(i) where the statement or omission was made knowingly or recklessly, with a fine or imprisonment for a term not exceeding two years, or both; or
(ii) in any other case, with a fine.
(2) A person shall not commit an offence under sub-section (1) if the person did not know and could not reasonably be expected to have known that the statement to which the prosecution relates was false or misleading.
(3) “Entry against S.No 10 in column (2) of the Table in sub-section (1) of section 182” shall apply in determining whether a person has made a statement to an income tax authority.
(Disclaimer: The text of the above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)