ISLAMABAD: The Federal Board of Revenue (FBR) is set to introduce a faceless audit and assessment system across all four taxes it administers, under provisions proposed in the Finance Bill 2026.
The reform, applicable to income tax, would see audit proceedings under section 177 and subsequent amendment proceedings under sections 122 and 111 of the Income Tax Ordinance, 2001, conducted without direct identification of the presiding officer.
Where a taxpayer is entitled to a hearing during audit proceedings, that hearing will be conducted electronically under section 227E of the Ordinance.
The facial and voice identity of the officer conducting the hearing will be kept confidential throughout the process.
The Finance Bill also proposes the introduction of a faceless appeals system through the insertion of section 129A into the Income Tax Ordinance, 2001.
This provision covers appeals to be decided by the Commissioner (Appeals). The existing second appeal mechanism before the Appellate Tribunal remains unchanged.
