Business community expresses displeasure over tax laws amendments
Business
RCCI voiced strong opposition to the sweeping powers granted to the FBR under the ordinance
RAWALPINDI (APP) – The business community has expressed serious concern over the promulgation of the Tax Laws (Amendment) Ordinance, 2025, terming it a direct violation of business autonomy and a blow to investors’ confidence.
In a statement, Rawalpindi Chamber of Commerce and Industry (RCCI) President Usman Shaukat voiced strong opposition to the sweeping powers granted to the Federal Board of Revenue (FBR) under the ordinance.
“We categorically reject the arbitrary and coercive provisions introduced through this Ordinance,” said Shaukat adding “allowing tax officers to be stationed at markets and business premises is an outright infringement on business freedom and will lead to increased harassment under the guise of documentation and compliance.”
It is noteworthy that the Ordinance gives authority to the FBR to recover tax liabilities by directly withdrawing funds from a taxpayer’s bank account if their appeal is rejected by the High Court or dismissed by the Supreme Court. This overrides the previously established procedure under Sections 137(2) and 138(1) of the Income Tax Ordinance, 2001, which required the issuance of separate notices before any recovery action could be taken.
“These coercive measures implemented even after a High Court ruling, pose a grave threat to the right of appeal, especially when enforced before the Supreme Court has given its verdict,” Shaukat added.
According to the statement issued here on Monday, the RCCI also highlighted legal ambiguities within the Ordinance, particularly the lack of clarity on whether the FBR will promptly refund any recovered amounts if the case is eventually decided in the taxpayer’s favour.
Moreover, the Chamber condemned the provision allowing tax officers to be physically deployed at business premises to monitor daily operations, calling it excessive, invasive, and harmful to business confidence.
The RCCI has called for the immediate withdrawal of the Ordinance and urged the government to initiate dialogue with stakeholders before introducing legislation with such far-reaching consequences for the business community.
The Tax Laws (Amendment) Ordinance, 2025, was promulgated by the President of Pakistan on May 2, 2025. It aims at addressing urgent legal, administrative and enforcement gaps in the tax system and introduces only three carefully scoped amendments.
A press release issued by the Ministry of Finance on Monday said that the first amendment relates to Sections 138(3A) and 140(6A), concerning the immediate payment of tax demand even if a stay is granted or an appeal is pending.
The second amendment pertains to the posting of FBR officers at business premises under Section 175C. This introduces measures for the revenue monitoring of high-end services and sectors operating outside the scope of the existing sales tax regime.
The third amendment addresses the visits of Federal Board of Revenue (FBR) officers to private sector industries not currently accountable to FBR. The visits of FBR officers and officials to business premises engaged in taxable activities — whether earning taxable income or supplying taxable goods and services — are strictly regulated through a series of rules and STGOs.
