Rejected budget proposal by FBR not accepted by NA panel for tracking manufacturing output within industry sector.
In a nail-biting turn of events, the National Assembly Standing Committee on Finance and Revenue has shot down a budget proposal by the Federal Board of Revenue (FBR) that aimed to deploy its employees to scrutinize the production of industries. Committee Chairman Naveed Qamar boldly declared, using colorful vernacular, that this move would create a "second National Accountability Bureau (NAB)" - a reference to Pakistan's powerful anti-corruption watchdog.
Qamar argued vehemently against the proposal to involve police, Rangers, and Intelligence Bureau personnel along with the FBR, calling it a underhanded plan to pad the pockets of FBR officials. The FBR chairman, undeterred, defended the move, stating that the current system is riddled with a staggering gap of Rs6 trillion, including Rs2 trillion in income tax and Rs4 trillion in sales tax, and needs fixing.
The proposal suggested that the FBR, in collaboration with scheduled banks, share tax-related information and utilize data-driven risk tools to identify high-risk individuals. It also proposed that the Board or the Chief Commissioner could station an Inland Revenue officer at a person's premises to monitor their production, stock, and supply of goods or services.
Finance Minister Muhammad Aurangzeb voiced his concerns about the widespread distrust in the tax department, but assured that the Federal Board of Revenue (FBR) was taking steps to rebuild its reputation and credibility. However, the proposal to share banking information of high-risk individuals was deferred by the committee, sparking an ongoing debate.
The FBR chairman clarified that the initiative aimed to target suspicious bank transactions, with banks being mandated to flag them, as part of new measures to tighten revenue collection. The committee also discussed broader reforms in tax compliance and enforcement.
Defending a new withholding tax on online shopping, the FBR chairman projected that it could generate an additional Rs59 billion in revenue. He firmly backed the recently imposed tax on e-commerce transactions, deeming it the best feasible way to collect taxes from digital vendors.
The Member Inland Revenue Policy explained that the new tax applies to both local and foreign sellers using Pakistani online platforms, with a separate system being developed for cross-border digital vendors. The chairman emphasized that foreign sellers keeping goods in Pakistan would be taxed similarly.
The fierce opposition to the FBR's industrial monitoring proposal raises questions about the future of taxes and regulation in the Pakistani economy. While the debate rages on, the FBR continues its efforts to streamline tax collection and improve its image.
[Source: Business Recorder, 2025. Additional insights from external sources have been incorporated to provide context and detail, but the main focus remains on the initial base article.]
- The ongoing controversy surrounding the FBR's proposed intervention to monitor industrial production has expanded to include discussions on the general-news front, as concerns about the role of finance and business in shaping politics become increasingly relevant.
- In light of the FBR's efforts to rebuild its reputation and credibility, the proposed utilization of data-driven risk tools to identify high-risk individuals in the context of tax-related information sharing with scheduled banks raises questions about the potential risks and rewards associated with such asset-tracking measures.
- As the discussion on industrial monitoring and tax collection evolves, various stakeholders, including the finance ministry, businesses, and political parties, have expressed their differing viewpoints on the appropriate balance between enhancing revenue, safeguarding privacy, and mitigating risks associated with various business activities.
