The National Assembly Standing Committee on Finance strongly criticized the government and the Federal Board of Revenue (FBR) on Friday for bypassing Parliament by enforcing the Tax Laws (Amendment) Ordinance, 2025.
The committee expressed frustration over the ordinance being urgently circulated to FBR field offices for immediate recovery from taxpayers without prior parliamentary debate.
During the committee meeting, chaired by MNA Syed Naveed Qamar, members discussed the implications of Ordinance No. IV/2025, raising concerns from trade bodies and stakeholders. Qamar labeled the ordinance as a misuse of executive power, emphasizing that it denied taxpayers the fundamental right of appeal before enforcement actions. He directed the Law and Justice Division to promptly present the ordinance in Parliament for debate and proper legislative process.
The FBR Chairman, Rashid Mahmood Langrial, defended the ordinance, stating it was lawfully approved by the federal cabinet and the president. He urged the committee to allow a one to two-month trial period for the ordinance, stressing that it addresses crucial legal gaps in tax enforcement.
However, committee members remained unconvinced. They questioned the urgency behind bypassing the usual process of including such tax amendments in the upcoming Finance Bill 2025-26. When pressed, a representative from the Law Division admitted to the urgency but failed to justify it clearly. The committee emphasized that all changes to tax laws must be evaluated carefully to prevent negative effects on the economy and other sectors.
Naveed Qamar reiterated that the FBR had not provided a convincing explanation for the need to issue the ordinance without prior consultation. He assured that the committee would scrutinize the ordinance once it is tabled as a bill.
MNA Mirza Ikhtiar Baig also criticized the move, stating that it contradicts the FBR’s own commitment to creating a business-friendly tax environment. He noted strong opposition from trade organizations, including the Federation of Pakistan Chambers of Commerce and Industry (FPCCI).
The FBR Chairman explained that the ordinance contains only three targeted amendments, focused on streamlining tax recovery after final court decisions. He said Sections 138(3A) and 140(6A) were introduced to close legal loopholes that allowed delays in payment, resulting in the non-recovery of billions in tax revenue—even after verdicts from the Supreme Court or High Courts.
The committee concluded that while legal enforcement is necessary, tax reforms must not come at the cost of parliamentary oversight or taxpayer rights.