Government empowers FBR for immediate tax recovery

The federal government has empowered the Federal Board of Revenue (FBR) to initiate the immediate recovery of taxes following court rulings, under the newly promulgated Tax Laws Amendment Ordinance 2025.

According to the ordinance, approved by the President of Pakistan, the amendment allows the FBR to recover taxes without any waiting period after a decision by the High Court or Supreme Court of Pakistan, bypassing the previous 30-day grace period.

This change has been introduced through the insertion of sub-sections (3A) and (6A) into the Income Tax Ordinance, 2001.

Under the new provisions, “notwithstanding anything contained in this ordinance or any other law or rule,” once the High Court or Supreme Court rules on a tax matter, the payable tax becomes immediately recoverable—or within a time specified in the notice issued by tax authorities—regardless of any timeline provided in prior laws or judgments.

Sources indicate that this change aims to accelerate revenue collection to meet current-year targets.

The ordinance also grants the FBR the authority to deploy Inland Revenue officers to business premises. The FBR Board or the Chief Commissioner may now assign officers to monitor the production, stock, and supply of goods or services.

This step is intended to curb tax evasion by enhancing on-site surveillance of business activities.

Additionally, the government has introduced amendments to the Federal Excise Act, 2005. A new Section 27(4) empowers the FBR to authorize federal or provincial officers and employees to act as Inland Revenue Officers, enforcing measures against counterfeit and non-compliant goods.