Islamabad, May 5, 2025: In a bold and controversial move, President Asif Ali Zardari has signed into law the Tax Laws (Amendment) Ordinance, 2025, granting the Federal Board of Revenue (FBR) sweeping powers to seize taxes directly from bank accounts or assets without issuing fresh notices — once the courts rule in its favor.
This marks a seismic shift in Pakistan’s tax enforcement landscape, fast-tracking recoveries and sidestepping traditional notice procedures under Section 138 of the Income Tax Ordinance, 2001.
Experts say this ordinance effectively removes one of the last barriers protecting taxpayers after court rulings, giving FBR unprecedented access to company finances and operations.
With immediate effect, tax officials can now monitor production lines, stock inventories, and business activities right at manufacturing premises.
The first major impact was felt by Telenor Pakistan, which, following an Islamabad High Court (IHC) decision, agreed to settle billions in dues with the FBR.
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Telenor, one of Pakistan’s largest corporate taxpayers, emphasized its commitment to lawful compliance and clarified it still reserves the right to pursue legal remedies if needed.
A spokesperson stated, “We believe in resolving tax matters through due process and continue to engage constructively with authorities.”
Another telecom joint venture, unnamed by officials, also agreed to pay its outstanding tax liabilities following similar court orders.
Meanwhile, Jazz, another major player in the telecom sector, struck a deal with the FBR for a massive Rs. 20 billion tax settlement related to imported equipment — choosing to avoid further litigation.
This comes just as Jazz’s infrastructure arm, Deodar, which was sold to Engro Corporation in a $563 million deal, remains caught in legal limbo pending unresolved issues.
Jazz, however, firmly rejected reports of any adverse court judgments, reiterating, “We have always fulfilled our obligations in accordance with the law, without compromising the constitutional rights guaranteed to us.”
This rapid series of recoveries signals a new era in Pakistan’s tax enforcement — one that businesses must carefully navigate.
Tax consultants warn that while the ordinance boosts FBR’s collection capabilities, it may raise concerns about legal overreach and the protection of taxpayer rights.
