ISLAMABAD: The federal government is expected to introduce stringent measures targeting non-filers in the upcoming budget 2025–26, with new legislation likely to restrict their ability to carry out economic transactions.
According to a report, the proposed Tax Laws (Amendment) Bill, 2024 is expected to be incorporated into the Finance Bill 2025, marking a key step toward tightening fiscal controls on non-filers.
The Federal Board of Revenue (FBR) has proposed Section 114C under this amendment, which would impose strict limits on various financial dealings by individuals who fail to file their income tax returns.
However, the implementation of these measures has been delayed due to the lack of necessary upgrades in the FBR’s digital infrastructure. FBR Chairman Rashid Mahmood Langrial recently requested a two-month period to finalize the development of a technological system capable of enforcing these new restrictions.
Back in February 2025, the National Assembly Standing Committee on Finance had deferred implementation of Section 114C, directing the FBR to first demonstrate that its systems could support such enforcement.
Former Minister of State for Finance, Ali Pervaiz Malik, assured the committee that the government remained committed to documenting non-filers and integrating enforcement tools within the FBR’s digital platforms.
He highlighted a historical failure to prosecute non-filers, noting that the upcoming budget would correct that course by embedding compliance mechanisms into the tax system.
“The tax system cannot function if we continue to use non-filers merely as revenue spinners without ensuring legal accountability,” Malik stressed. He confirmed that the deferment would not affect the broader drive to bring untaxed assets and individuals under formal documentation.
The FBR, already in possession of comprehensive property transaction data, plans to collaborate with NADRA, provincial excise departments, and land authorities to ensure the new system is ready before the budget announcement in June 2025. A live demonstration of the online application is expected within two months, which will be a key factor in finalizing Section 114C as part of the budget package.
The Revenue Division has also been advised to refine Clause 5(a), especially to clarify definitions related to “cash and equivalent assets,” ensuring greater precision before its inclusion in the budget.
