These powers allow the Federal Board of Revenue (FBR) to summon anyone involved in transactions above Rs2 lakh without prior notice.
According to officials, FBR began collecting data of merchants in major cities like Lahore, Karachi, Rawalpindi, Faisalabad, Sialkot, Gujrat, and Gujranwala. This includes their assets, vehicles, and bank account holdings—with notices set to issue to those underpaying tax in the first phase.
Sources say if responses to these notices are unsatisfactory, legal action will ensue. Meanwhile, traders are pushing back, demanding that tax-free transaction limits remain Rs50 lakh.
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The tougher regulations come amid growing unrest. Business groups, including LCCI, KCCI, and other chambers, have called for a nationwide shutter-down strike on 19 July, opposing Sections 37AA, 37B, and new penalties under Section 21(s) for cash transactions above Rs2 lakh.
These bodies argue that the measures are draconian, granting the FBR sweeping “arrest powers” and mandating digital invoicing and E-billing, all implemented without consultation.
In meetings chaired by Finance Minister Aurangzeb, government officials agreed to form a joint committee led by PM’s aide Haroon Akhtar Khan and FBR chair, aiming for a resolution within 30 days. While FPCCI postponed the strike, Lahore and Karachi chambers insisted the protest will go ahead unless key clauses are rolled back.
Officers can now summon taxpayers unannounced and potentially arrest them for alleged tax under-declaration. Wealth data, including bank transactions and assets, is now being mined to identify non-filers. Traders view the move as extreme and fear it will cripple SMEs. The July 19 strike may escalate if no compromise is reached.
The government s aggressive tax enforcement approach has triggered significant backlash. With the business world threatening mass protests and the FBR doubling down on data collection, Pakistan faces a pivotal moment ahead of the July 19 deadline.
