In a significant move under the Finance Bill 2025–26, the Federal Board of Revenue (FBR) has been empowered to take stricter enforcement actions. Inland Revenue officers are now authorized to arrest company Directors, CEOs, CFOs, and any individuals involved in aiding or abetting tax fraud.
According to the new provision:
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Arrests can be made during investigations, based on credible evidence, with prior approval from the Commissioner.
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In urgent or exceptional cases, arrests may proceed without prior approval, provided that a report and justification are submitted immediately thereafter.
These expanded powers mark a decisive step in the government's efforts to curb tax evasion and reinforce compliance.