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17/05/2026

#آج ہی اپنا کاروبار رجسٹر کروائیں
امپورٹ ایکسپورٹ کا لائسنس 3 دن
فائلر ہونے سالانہ گوشوارے جمع کرانے کے لیے
صرف ایک کال پر پروفیشنل سروس حاصل کریں۔
واٹس ایپ
0305-7389007

آج ہی اپنا کاروبار رجسٹر کروائیں امپورٹ ایکسپورٹ کا لائسنس 3 دن فائلر ہونے سالانہ گوشوارے جمع کرانے کے لیے صرف ایک کال ...
17/05/2026

آج ہی اپنا کاروبار رجسٹر کروائیں
امپورٹ ایکسپورٹ کا لائسنس 3 دن
فائلر ہونے سالانہ گوشوارے جمع کرانے کے لیے
صرف ایک کال پر پروفیشنل سروس حاصل کریں۔
واٹس ایپ
0305-7389007

17/05/2026

to seek tougher penalties for digital invoicing violations in Finance Bill 2026

Pakistan commits to stricter enforcement of digital invoicing under IMF-backed reforms

The Federal Board of Revenue (FBR) is set to propose stricter penalties for taxpayers failing to comply with digital sales tax invoicing requirements in the upcoming Finance Bill 2026, as part of Pakistan’s commitments under reforms linked to the International Monetary Fund.

According to official documents, Pakistan has assured the IMF that the FBR will introduce legal amendments aimed at strengthening enforcement against non-compliance with the digital invoicing regime.

Digital invoicing rollout gains pace

Under the existing framework, all entities registered as sales tax filers were required to register on the FBR’s digital invoicing platform by December 31, 2025.

However, by the end of March 2026, only around one-third of registered taxpayers were reportedly issuing live digital invoices through the system.

To accelerate adoption, the FBR plans to issue two notifications by the end of March 2026 allowing easier correction of invoicing errors and permitting multiple licensed integrators to connect with the system.

Officials expect all active sales taxpayers to adopt the digital invoicing system by July 31, 2026.

FBR expects Rs46 billion additional revenue

The new digital invoicing mechanism has been designed to simplify sales tax filing procedures and automate the calculation of sales tax liabilities for taxpayers.

Authorities believe the system will improve monitoring of business transactions and reduce tax evasion, potentially generating an additional Rs46 billion in revenue during fiscal year 2026-27.

Pakistan Revenue Automation Limited (PRAL) has assigned 16 personnel to support the operation of the system.

The FBR will monitor the performance of the digital invoicing initiative through key performance indicators, including the total value of invoices processed digitally and the number of taxpayers issuing live invoices on the platform.

The proposed penalties and enforcement measures are part of broader tax administration reforms aimed at improving documentation of the economy and strengthening revenue collection.

16/05/2026

targets bottled water production through electronic monitoring

production tracking system introduced to curb sales tax evasion

The Federal Board of Revenue has launched an electronic monitoring system for bottled water production aimed at preventing sales tax evasion and improving tax compliance in the sector.

In this regard, the FBR issued Sales Tax General Order (STGO) No. 3 of 2026 for the implementation of electronic monitoring at bottled water manufacturing facilities across the country.

The monitoring initiative has been launched under Section 40C(2) of the Sales Tax Act, 1990, read with Rules 150ZQR and 150ZQT of Chapter XIV-BA of the Sales Tax Rules, 2006.

According to the FBR, all registered persons involved in the production and packaging of bottled water, including toll manufacturers, are required to install an electronic production monitoring system with immediate effect.

The tax authority directed all relevant businesses to complete installation of the system by June 15, 2026.

Under the new framework, manufacturers will be required to install industrial barcode scanners, counting sensors, industrial computers, IP cameras, network video recorders, programmable logic controllers, LED displays, and uninterrupted power supply systems.

The monitoring setup will also include specialized production monitoring software capable of real-time tracking and transmission of production data to the FBR’s central control unit.

According to the order, the system must support real-time object detection and counting, quantitative production analysis, data archiving, detection of unexpected production stoppages, and analytics for legal enforcement actions.

The FBR said the monitoring systems would be supplied, installed, and maintained by vendors authorized by the board.

To ensure implementation, Chief Commissioners Inland Revenue have been directed to appoint dedicated focal persons to coordinate with bottled water manufacturers and authorized vendors.

Tax experts said the move is part of broader efforts by the FBR to digitize industrial monitoring and reduce underreporting of production and sales in sectors vulnerable to tax leakage.

They noted that electronic production monitoring has previously been introduced in industries such as sugar, to***co, fertilizer, and cement to improve revenue collection and transparency.

The latest initiative reflects the government’s ongoing push toward documentation of the economy and technology-driven tax administration reforms.

16/05/2026

recommends FTR revival for exporters in Budget 2026-27

Trade body urges government to ease compliance burden in budget 2026-27

Federation of Pakistan Chambers of Commerce and Industry has proposed the revival of the Final Tax Regime (FTR) for exporters in the upcoming budget 2026-27, arguing that the withdrawal of the regime has increased compliance costs and tax-related uncertainty for exporters.

In its budget proposals, the FPCCI said exporters of goods were facing higher documentation requirements, audit-related issues, and growing compliance burdens after the FTR was discontinued.

The apex trade body recommended reinstating the Final Tax Regime as a full and final tax liability for exporters to simplify taxation and reduce administrative hurdles.

It also proposed allowing exporters to choose between the Final Tax Regime and the Normal Tax Regime according to their business needs.

According to FPCCI, the proposal has support from several business organizations and industry groups, including the All Pakistan Textile Mills Association, Faisalabad Chamber, Textile Processing Mills Association, Pakistan Readymade Garments Manufacturers and Exporters Association, towel manufacturers, and FPCCI’s advisory bodies.

Business leaders said restoring the FTR could help improve export competitiveness by reducing uncertainty surrounding tax assessments and audits.

The FPCCI also proposed extending tax incentives for Pakistan’s information technology sector.

The chamber noted that Pakistan’s IT exports currently stand at around $3.8 billion but have the potential to reach $10 billion in the coming years.

It recommended maintaining the existing 0.25% tax rate on IT and IT-enabled services exports until 2035 to ensure long-term policy consistency and encourage further investment in the sector.

The proposal has backing from Pakistan Software Houses Association, IT exporters, and FPCCI’s Policy Research and Budget Advisory Council.

The government is currently finalizing budget proposals for fiscal year 2026-27 ahead of the federal budget announcement expected next month.

Exporters and industry groups have been urging policymakers to introduce business-friendly tax measures to support economic growth, increase exports, and attract investment.

16/05/2026

launches nationwide “Go Cashless” campaign for Eid-ul-Azha 2026

Central bank expands digital payments initiative to 96 cattle markets across Pakistan

The State Bank of Pakistan has launched a nationwide “Go Cashless” campaign for Eid-ul-Azha 2026 aimed at promoting secure and convenient digital transactions in cattle markets across the country.

The initiative is part of the central bank’s broader strategy to reduce reliance on cash and accelerate digitization of Pakistan’s payment ecosystem.

During Eid-ul-Azha, cattle markets witness massive commercial activity, with a large volume of transactions traditionally conducted through cash payments.

Recognizing the opportunity to enhance digital financial inclusion, the SBP has continued expanding its seasonal campaign to encourage the use of electronic payment channels in cattle markets.

According to the central bank, the 2026 campaign has been significantly expanded, with coverage increasing to 96 cattle markets nationwide compared with 54 markets covered in 2025.

Under the initiative, 22 participating banks will establish dedicated camps and kiosks in assigned cattle markets to facilitate digital payments for buyers and sellers.

The banks will onboard cattle traders, transporters, and related service providers onto digital platforms through account opening services and QR code-based payment solutions.

To support higher transaction activity during the Eid season, the SBP has also introduced temporary relaxations on transactional and account balance limits from May 14, 2026 to June 5, 2026.

In addition, mobile banking vans, automated teller machines (ATMs), and cash deposit machines (CDMs) will be deployed where feasible to improve access to financial services in and around cattle markets.

The SBP encouraged the public to use digital payment channels including mobile banking applications, branchless banking wallets, Raast services, and QR code payments for Eid-related transactions.

The central bank said digital payments provide greater convenience and security while reducing risks associated with carrying large amounts of cash.

It added that wider adoption of digital transactions would contribute to building a more transparent, efficient, and inclusive financial ecosystem in Pakistan.

Financial analysts said the initiative could help boost digital payment adoption among small traders and rural communities during one of the country’s busiest seasonal trading periods.

🛑FBR Intensifies Enforcement of e-Invoicing ComplianceThe Federal Board of Revenue (FBR) has started issuing notices to ...
14/05/2026

🛑FBR Intensifies Enforcement of e-Invoicing Compliance

The Federal Board of Revenue (FBR) has started issuing notices to businesses for failure to integrate and transmit electronic invoices in real time under the Sales Tax Act, 1990.

These enforcement actions reflect the government's increasing focus on digital tax compliance and transaction transparency.

Businesses that have not yet implemented FBR e-Invoicing integration should treat this as an urgent compliance matter. The authorities are actively monitoring taxable supplies through IRIS and other integrated data systems, and non-compliance may expose businesses to penalties, recovery proceedings, and adjudication actions.

Potential consequences of non-compliance include:

Penalties under Section 33 of the Sales Tax Act
Show Cause Notices and assessments
Recovery proceedings
Ex-parte adjudication based on available record

The direction is clear:

FBR e-Invoicing is no longer optional - it is becoming a core compliance requirement for registered businesses in Pakistan.

To remain compliant, businesses should immediately:

Integrate POS, ERP, or accounting systems with FBR
Enable real-time electronic invoice transmission
Conduct compliance reviews of previous transactions
Train finance and tax teams on e-Invoicing procedures

Businesses delaying integration today may face enforcement notices tomorrow.

14/05/2026

is planning to introduce an AI-based tax system through the upcoming Finance Bill 2026 to identify false information in tax returns and strengthen enforcement against tax evasion.

proposal was discussed during a high-level meeting in Islamabad chaired by Federal Minister for Economic Affairs Mr. Ahad Cheema to review tax enforcement measures for the federal budget 2026-27.
#
The meeting was attended by Federal Minister for Climate Change Mr. Musadik Malik, Advisor to the Prime Minister on Industries and Production Mr. Haroon Akhtar Khan, Minister of State for Finance Mr. Bilal Azhar Kayani, FBR Chairman Mr. Rashid Mahmood Langrial, Attorney General for Pakistan Mr. Mansoor Usman Awan, and senior officials.

-based monitoring system under consideration:

During the briefing, FBR officials presented several proposals aimed at reducing the tax gap, curbing underreporting, preventing under-invoicing, and controlling smuggling activities.

Among the major proposals was the introduction of an AI-based tax system capable of detecting false declarations and suspicious transactions in tax returns through automated digital monitoring mechanisms.

said the proposed system would help strengthen oversight, minimize tax fraud, and improve documentation in the economy through technology-driven enforcement tools.

14/05/2026

Summary
An Association of Persons (AOP) in building construction appealed a Super Tax levy under section 4C of the Income Tax Ordinance, 2001, for tax year 2022. The department assessed Super Tax (Rs. 4,877,449 plus surcharge) on the AOP's declared income of Rs. 243,872,465, treating it as "imputable income" under section 2(28A), despite the AOP's claim that its income fell under the final tax regime of section 100D (Eleventh Schedule).

Core Issue
Whether income taxed as final tax under section 100D (builders/developers) qualifies as "imputable income" for Super Tax under section 4C.

Key Arguments
Appellant's (AOP) Position: Section 100D provides final discharge of tax liability; income cannot be "worked back" as imputable for additional Super Tax.

Department's Position: Section 4C(2) explicitly includes imputable income (per section 2(28A)), covering final-taxed income under section 100D. Relied on Federal Constitutional Court judgment in Civil Appeal No. 1243 of 2020, upholding Super Tax's wider income base.

Tribunal Decision
Appeal rejected; Super Tax upheld. Tribunal ruled:
It is an admitted position that the tax paid under section 100D in respect of builders and developers is treated as final tax in nature under sub-Clause (d) of Clause 2 of Section 2 to the Eleventh Schedule to the Ordinance which reads as under:-

“The tax liability so calculated and paid shall be final tax”
Therefore, such income squarely falls within the ambit of “imputable income” as defined under section 2(28A) of the Income Tax Ordinance, 2001.

Income under section 100D is imputable income per section 2(28A).

Legislature can define a distinct income base for Super Tax, even if final-taxed elsewhere.

No legal bar to additional levy on final-taxed income.

2026 SLD 1425

14/05/2026

Case Summary
In this appellate order the taxpayer challenged a DCIR's order dated 27.01.2026 levying Super Tax u/s 4C on declared income of Rs. 234,925,007 for tax year 2024 (exceeding Rs. 150M threshold). The Assessing Officer imposed 2% Super Tax at Rs. 5,585,164, rejecting the taxpayer's claim for tax credit u/s 65D (for a newly established industrial undertaking), which they argued would reduce income below the threshold.

Core Point
'Tax credit' and 'exemption'---Conceptual distinction-
Super Tax u/s 4C is computed on "income" as defined in s.4C(2)—before tax credits like s.65D. The tribunal rejected the appeal, holding:

"Income" for Super Tax includes taxable income u/s 9 (excluding brought-forward losses/depreciation), profit on debt, dividends, capital gains, etc., with no provision to deduct/exempt tax credits (distinguishing credits from exemptions).

Cited Supreme Court (2019 PTD 1479, para 92) and FCC (Civil Appeal 1243/2020, 27.01.2026) clarifying exemptions (e.g., certain capital gains) apply, but not tax credits.

No law or precedent mandates excluding s.65D credit when determining Super Tax liability.

Appeal dismissed; order upheld. Case recommended for reporting due to clarifying Super Tax computation principles.

2026 SLD 1426

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