Pakistani banks to flag undocumented
large scale transactions
Federal Board of Revenue (FBR)
Chairman Rashid Mahmood Langrial has informed the National Assembly Standing
Committee on Finance that the FBR intends to leverage commercial banks to
detect undocumented large-scale business transactions.
This initiative is outlined in the
proposed Section 175AA of the Finance Bill 2025–26, titled “Exchange of
Banking and Tax Information Related to High-Risk Persons.” Under this
provision, banks will be required to share transaction data with the FBR based
on a yet-to-be-defined turnover threshold. In return, the FBR will provide only
the Computerised National Identity Card (CNIC) numbers of account
holders—without disclosing any tax return information.
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The move is aimed at identifying and
flagging high-value, unreported transactions. To facilitate this, the FBR will
share CNIC batches with banks to request relevant financial details.
Langrial also called for a clause
mandating support from the State Bank of Pakistan and recommended the
establishment of a central banking data repository. This would allow for more
effective monitoring and prevent individuals from evading scrutiny by dividing
transactions or maintaining multiple accounts.
However, some committee members
raised concerns about a sub-clause that permits the FBR to share information
such as income, turnover, and account numbers from tax filings with scheduled
banks, along with insights derived from data analytics. In response, Langrial
assured the committee that the FBR is willing to revise or remove this clause
to ensure only CNICs are shared.
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The proposal forms part of the
government’s broader efforts to boost tax compliance and bring informal
economic activities into the documented economy.
Source: Profit Pakistan