Islamabad, July 10, 2025 – Chairman of the Federal Board of Revenue (FBR), Rashid Mahmood Langrial, firmly stated that the newly implemented tax regulation disallowing 50% of expenditure on cash sales exceeding Rs 200,000 per transaction would remain in place. He emphasized that the government has no intention of reversing the legislation, which was introduced through the Finance Act 2025.

The law, which took effect on July 1, 2025, applies to “Income from Business” as defined under Section 18 of the Income Tax Ordinance, 2001. Langrial clarified that while the National Assembly and Senate Standing Committee on Finance had approved the law, any revisions could only be considered in the next Finance Bill for 2026-27.

In response to concerns raised by members of the Senate Standing Committee, including Senator Mohsin Aziz, who called the law “anti-business” and feared negative impacts on the business community, Langrial defended the measure. He explained that the government’s push toward a cashless economy was at the core of this policy, adding that limiting cash transactions beyond a certain threshold would help foster this shift.

Senator Sherry Rehman criticized the new regulation, describing it as a “draconian law” and highlighted the opposition of the Pakistan Peoples Party to the provision. Despite the objections, Langrial assured the committee that the law aligns with the government’s long-term economic objectives.

In the same session, Langrial addressed concerns about potential political interference within the FBR. He categorically rejected allegations that the tax body had been used to target political figures, assuring the committee that the FBR had maintained strict separation from political influence. He further warned tax officials that any attempt to exert such pressure would result in immediate suspension.

The committee also discussed a case raised by Senator Afnanullah Khan regarding harassment by FBR officials over tax demands for an incomplete project. Langrial promised swift action on the matter and assured that any official found guilty of misconduct would face appropriate disciplinary measures.

Senator Mohsin Aziz also raised an issue regarding the reopening of taxpayer cases, to which Langrial responded that FBR officials were instructed to collect only the correct amount of taxes and not engage in arbitrary reopening of cases.

Additionally, the meeting included a discussion on the status of barter trade between Pakistan and Iran. Officials noted that the Commerce Ministry had initiated talks based on mutual understanding, with final arrangements subject to approval by both the FBR and the State Bank of Pakistan (SBP).

Langrial’s firm stance on the new legislation and his commitment to a non-political FBR reflected the government’s dedication to implementing tax reforms, despite challenges from various political and business stakeholders.