ISLAMABAD: The Federal Board of Revenue (FBR), Pakistan’s central tax authority, is under fire after it exercised its newly granted powers to seize Rs 80 million directly from the bank account of a Karachi-based restaurant, Kebab Jees, without prior notice, sending shockwaves through the country’s business community.
This bold move is the result of expanded authority granted to the FBR under the Tax Laws (Amendment) Ordinance 2025, which allows the agency to directly withdraw funds from any taxpayer’s account following a favourable court ruling, bypassing the traditional route of issuing prior warnings or engaging in dialogue. While the FBR claims it is acting within its legal mandate to curb tax evasion and improve revenue collection, business leaders and economists warn that the agency’s aggressive and opaque approach risks damaging the very economy it is meant to support.
“The FBR is now operating like a financial police force,” said Haroon Sharif, a former Minister of State and tax reform advocate. “This kind of unchecked authority is counterproductive and undermines business confidence.”According to Sharif, while tax evasion remains a major challenge in Pakistan, solutions must be systemic and trust-based. “Raids and account freezes may generate headlines—but they don’t build a sustainable tax culture.”
The FBR’s unprecedented action has reignited concerns over financial privacy and due process. Many are questioning whether the agency should be allowed to bypass standard legal safeguards. “Taking money out of an account without notice is financial overreach,” said Zafar Motiwala, an economist and senior industrialist. “This sends a chilling message to all businesses: your bank accounts are no longer safe.” He warned that such actions could lead to widespread withdrawals from the banking system, with businesses opting for cash-based transactions, weakening Pakistan’s already fragile documented economy.
The FBR has been pursuing a broader crackdown on tax evasion, including freezing accounts, confiscating properties, and seizing vehicles. However, critics argue that the agency is using force rather than reform to meet revenue targets. “You cannot collect taxes at gunpoint and expect economic growth,” said one Karachi-based trader. “This isn’t enforcement—it’s intimidation.”
Traders argue that these tactics will drive businesses into the informal sector and discourage foreign and local investment, especially at a time when Pakistan is struggling with record inflation, high interest rates, and a depreciating currency. Experts believe that the FBR’s focus on urban businesses and high-visibility targets, while politically convenient, is missing the larger picture. Agriculture and large swaths of the retail sector—both known for chronic under-taxation—remain largely untouched.
“Selective enforcement deepens inequality,” Motiwala said. “The biggest tax evaders are in sectors the FBR won’t touch—like agriculture. Why only raid restaurants in Karachi?” Sharif added that sustainable reform requires digital tools, education campaigns, and transparent spending, not fear-based enforcement. As public reaction intensifies, FBR Chairman Rashid Langrial has promised a review of the Kebab Jees case, stating that details will emerge after an internal inquiry. However, the damage to public perception may already be done.
“The FBR’s reputation is now on the line,” said Sharif. “Unless it shifts its strategy from coercion to cooperation, Pakistan’s tax base will shrink, not grow.” The FBR’s newfound power to access bank accounts directly marks a pivotal shift in Pakistan’s tax enforcement strategy. While the goal of increasing revenue is justified, the methods being used are raising serious concerns about constitutional rights, business freedom, and long-term economic health.
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