Latest news with #TaxLaws(Amendment)Ordinance
Business Recorder
11-06-2025
- Business
- Business Recorder
Tax arrears recovery period slashed
ISLAMABAD: To immediately recover disputed tax from taxpayers, the federal government has drastically reduced time period for the recovery of tax arrears when a high court rules in favor of the tax department. Through Finance Bill 92025-26), the Federal Board of Revenue (FBR) has introduced a significant amendment to the Income Tax Ordinance, 2001. The amendment, specifically a new subsection added to Section 140 of the Ordinance, stipulates that tax payable under an assessment order will become immediately recoverable, or within the time specified in a notice issued by the income tax authority, irrespective of timelines in other provisions or court judgments. This accelerated recovery is triggered when a tax issue is decided by a High Court or the Supreme Court of Pakistan. A crucial proviso within this new subsection clarifies the immediate impact on appeals: 'Provided that where the High Court decides the appeal filed by the Commissioner in favor of the department under section 133, recovery shall be made after seven days from the date of the order of the High Court.' This means that if a Commissioner's appeal against a taxpayer is upheld by the High Court, the tax arrears will become recoverable within a mere seven days from the date of the High Court's order. FBR is expected to issue further guidelines on the implementation of this amended section, particularly concerning the issuance of recovery notices and the procedures for taxpayers to adhere to the compressed timeline. Tax professionals and businesses are advised to carefully review their litigation strategies and prepare for swifter recovery actions in light of this new legal provision. When contacted, tax lawyer Waheed Shahzad Butt stated that earlier new amendments introduced through the Tax Laws (Amendment) Ordinance, 2025 have ignited controversy across legal and tax circles, as they grant sweeping powers to tax officers to recover taxes without issuing prior notice to taxpayers. Mr. Butt warned that such unchecked powers could erode public trust in the tax system and potentially lead to abuse. This will undermine the neutrality of the taxation system and promote tax robbery moves rather than genuine tax recovery. IHC has earlier ruled that a notice under Section 138, is mandatory before initiating any coercive tax recovery action under Section 140. Copyright Business Recorder, 2025
Business Recorder
03-06-2025
- Business
- Business Recorder
IHC halts FBR tax recovery under Tax Laws Ord, 2025
ISLAMABAD: In a major development, Islamabad High Court (IHC) has stopped the Federal Board of Revenue (FBR) from immediate tax recovery against taxpayers under the controversial Tax Laws (Amendment) Ordinance, 2025. In this regard, IHC has issued an order on Tuesday in favour of the private limited companies (petitioners). The National Assembly Standing Committee on Finance has also categorically conveyed to the Federal Board of Revenue (FBR) that the government has bypassed Parliament for promulgating Tax Laws (Amendment) Ordinance, 2025, and urgently communicated ordinance to the FBR's field formations for recovery from taxpayers. Tax laws bill: NA panel defers Sec 114C until FBR system overhaul According to the order of the IHC, the court has issued notices to the FBR to submit comments and meanwhile, no coercive measure to be taken by the FBR against the petitioners. The petitioners have requested the IHC to declare that the Tax Laws (Amendment) Ordinance 2025, promulgated on May 2, 2025, as Ultra Vires of the Constitution and void ab initio. IHC should declare that sections 138 (3A), 140(6A), 175 C of the Income Tax Ordinance, 2001 (as amended), and section 27 (4) of the Federal Excise Act, 2005 are inconsistent with Articles 4, 8, 10-A, 18, and 25 of the Constitution, hence void. IHC should suspend the operation of impugned Tax Laws (Amendment) Ordinance, 2025 dated 02.05.2025, till pendency of this Writ Petition and restrain the Respondents (FBR) from enforcing or taking any coercive action under the impugned provisions till pendency of this Writ Petition, petitioners added. Copyright Business Recorder, 2025
Business Recorder
24-05-2025
- Business
- Business Recorder
Tax ordinance will be reviewed, SAPM tells FPCCI
KARACHI: Haroon Akhtar Khan, Special Assistant to Prime Minister (SAPM) for Industries & Production, has assured a high-profile FPCCI delegation that the government will review the Tax Laws (Amendment) Ordinance, 2025, in the light of apex body's recommendations to help resolve the profound grievances of the entire business, industry and trade community of Pakistan. This was informed by Atif Ikram Sheikh, President FPCCI, President ECO-CCI and VP CACCI, after the meeting with SAPM on Friday. Sheikh led a senior delegation of the business community to meet Haroon Akhtar on several issues including Tax Laws (Amendment) Ordinance 2025, highhandedness of the Federal Board of Revenue (FBR), tax & tariff barriers in doing business in the country and the issues of Dangerous Petroleum Liquids. 'The meeting with SAPM and assurance is a resounding success of the rigorous policy advocacy endeavours on this critical issue of national significance,' he said. FPCCI demands reviewing Income Tax Amendment Ordinance During the meeting, Haroon Akhtar reiterated his commitment to playing a proactive role in resolving the problems faced by the business community. Additionally, he informed that Prime Minister Muhammad Shehbaz Sharif has given clear instructions to formulate problem-solving committees and advised to take business community on board in the policymaking consultations. FPCCI President maintained that all chambers, trade bodies and associations have grave reservations and apprehensions on Income Tax (Amendment) Ordinance 2025, as they believe that it will give rise to avenues of harassment, corruption and maladministration. He explained that it is an established fact and practice globally that the more a tax collector is allowed to intervene or interact with the taxpayer, the more it is likely to undermine the principles of fairness, transparency and impartiality due to the increased role of human-to-human interaction, and human judgement becomes a nuisance. 'Therefore, we do not need to reinvent the wheel in this matter', he added. Saquib Fayyaz Magoon, SVP FPCCI, apprised that during the meeting with SAPM, he decided to extend the six-month exemption granted till May 25, 2025 by another 6 months vis-à-vis 'Dangerous Petroleum Liquids' on FPCCI's demand. 'We need to define DPL well and resolve the transportation, availability, storage and regulatory issues vis-à-vis important raw materials for the industry and manufacturing in the form of chemicals,' he added. Hamid Arshad Zahur, Chairman of Pakistan Tanners' Association and Haroon Ali Khan, Chairman of Pakistan Chemical Manufacturers Association (PCMA), were also part of the FPCCI delegation. Copyright Business Recorder, 2025
Business Recorder
18-05-2025
- Business
- Business Recorder
FPCCI opposes Tax Laws (Amendment) Ordinance
KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has strongly rejected the newly implemented Tax Laws (Amendment) Ordinance, 2025, claiming it violates taxpayers' rights. The FPCCI has vowed to support legal challenge against this ordinance in court. During a press conference held at Federation House, Senior Vice President Saqib Fayyaz Magoon expressed serious concerns over the new tax amendment 2025, warning it would open new doors for corruption and intimidate investors. 'On one hand, the government is implementing a faceless system in customs. On the other hand, it's stationing FBR officials in factories and manufacturing units through Inland Revenue,' Magoon said. He questioned whether these FBR officers had been given 'certificates of honesty,' arguing their deployment would lead to increased corruption and harassment. Magoon criticised the 'extraordinary powers' granted to FBR representatives, including the removal of taxpayers' right to appeal. 'It's like skipping the FIR process and going straight to hanging,' he remarked. He further explained that the new laws allow FBR officials to be stationed in industries for monitoring purposes and authorise tax officers to recover funds directly from bank accounts under Section 140, eliminating the previous notice period given to banks. The FPCCI leadership also warned that ending captive power would destroy billions of dollars in industrial investment. He highlighted the contradictory approaches of FBR and the Special Investment Facilitation Council (SIFC) policies, claiming FBR harasses investors and SIFC strives to attract foreign investment. 'With such flawed policies, the Prime Minister's target of $100 billion in exports will not be achieved.' Vice President FPCCI Muhammad Aman Paracha pointed to what he called a 'trust deficit' between the government and business community, saying, 'Due to this lack of trust, tax targets will never be met.' He emphasised the need for a long-term policy framework spanning 10-15 years. Another Vice President, Nasir Khan claimed 'enemies are not just at the borders but sitting inside as policymakers.' He appealed to the Army Chief to provide protection for investors' capital. Dr Mirza Ikhtiar Baig, a Pakistan People's Party member of the National Assembly, claimed the government is planning to introduce legislation to end captive power. However, he assured that his party would oppose any such bill. He informed about an important upcoming meeting at Sindh Chief Minister's House with all stakeholders to address these concerns on Sunday (today). Senior business leader Bashir Jan Mohammad suggested that FPCCI should immediately meet with the Prime Minister to discuss these pressing issues. Copyright Business Recorder, 2025
Business Recorder
14-05-2025
- Business
- Business Recorder
Tax laws termed ‘death warrants for industries'
KARACHI: Industrialists categorically rejected the recently introduced Tax Laws (Amendment) Ordinance, 2025, describing it as undemocratic, unconstitutional, and a death warrant to industries. They denounced the ordinance for granting disproportionate authority to the Federal Board of Revenue (FBR), especially regarding tax recovery. Signed into effect by the President of Pakistan Asif Ali Zardari, the ordinance amends Sections 138 and 140 of the Income Tax Ordinance, 2001, along with key portions of the Federal Excise Act, 2005. The changes permit the FBR to execute immediate enforcement measures—such as freezing accounts, confiscating property, and sealing business premises—once a final ruling is issued by the High Court or Supreme Court, with no requirement for additional notice. The ordinance also allows FBR personnel to be physically deployed within factories and commercial sites to oversee production, stock levels, and the movement of goods. President FBATI Sheikh Muhammad Tehseen has condemned this as a serious infringement on operational freedom and a new layer of bureaucratic intrusion. 'Having tax officers embedded in our workplaces is not only invasive but amounts to institutional harassment,' said the FBATI president. 'This legislation undermines constitutional rights, weakens the role of the judiciary, and creates a hostile environment for current and potential investors.' He criticized the move for bypassing legislative and judicial oversight, which he said is a clear violation of the country's constitutional framework. Calling the ordinance overstep of authority, he stated, 'This kind of enforcement leaves no room for voluntary compliance or appeals. It's coercive and strips businesses of basic legal protections.' President SITE Superhighway Association of Industries (SSHAI) Pervaiz Masood said that the government allowed tax authorities to recover taxes from industries at gunpoint, which is an unlawful and unconstitutional act. The ordinance will seriously hit the business confidence within the country, he said. Not only it will discourage investments at a local level, but industries may move to other countries to avoid harassment culture. Copyright Business Recorder, 2025
