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The Federal Board of Revenue (FBR) will soon begin suspending bank accounts of unregistered sales tax evaders for a limited time, under the amended Finance Bill 2025-26.
The newly introduced Section 14AC (Bar on Operations of Bank Accounts) empowers FBR Commissioners to issue a written suspension order to banks and financial institutions after giving three separate notices to individuals failing to register for sales tax.
This short-term freeze will apply only to those involved in taxable goods supply without valid registration. The aim is to encourage voluntary compliance by giving repeated warnings before account action is taken.
Under the new framework, the initial three-day suspension can be enforced twice more, each a week apart. The maximum limit is three suspensions, avoiding long-term financial disruption while maintaining pressure to register.
The move is a measured shift in the FBR’s enforcement strategy.
Officials believe this method combines pressure with procedural fairness and helps increase Pakistan’s low tax compliance rates without harming legitimate business operations.
According to officials, the system ensures that individuals are provided ample time and opportunity to fulfill their legal obligations before facing account restrictions. Affected persons will receive formal notice before each action.
The measure will formally take effect on July 1, 2025, and is expected to contribute to the government’s ongoing drive to widen the tax net while enhancing institutional transparency and accountability.
