The business community has strongly rejected the federal budget for the fiscal year 2025–26, particularly objecting to the controversial proposal granting arrest powers to Federal Board of Revenue (FBR) officials. Terming the move “draconian,” several trade and industry bodies have warned the government of a nationwide strike if the provision is not immediately withdrawn. This backlash is not surprising. At a time when businesses are already reeling under inflation, high energy costs, and economic uncertainty, this additional threat of arbitrary arrest has only deepened their sense of insecurity and alienation.
Business leaders argue—rightfully—that the move will further erode confidence and deter investment. The FBR, they say, already has a reputation for harassment and overreach. Giving its officials unchecked authority to arrest businessmen without due process could open the floodgates for abuse, vendettas, and corruption. While the intent behind the move may be to tighten the noose around habitual tax evaders, in practice, it may end up targeting genuine taxpayers—those who are already contributing to the national exchequer and struggling to stay afloat.
The reality is that Pakistan’s tax base is narrow not because of a lack of legislation, but because of inconsistent implementation and selective accountability. There is no doubt that tax evasion is a serious problem. It has long plagued the country, depriving the national treasury of critical revenues needed for infrastructure, health, and education. But blanket punitive measures against the entire business class are not the solution. They risk alienating key economic players who are vital to job creation and growth.
Reports indicate that the government is reconsidering this proposal after severe backlash, which is a step in the right direction. However, a mere rollback is not enough. There must be a clear and transparent mechanism to distinguish between habitual tax dodgers and compliant taxpayers. Technology, data analytics, and third-party audits can play a vital role in achieving this without infringing on individual rights or disrupting economic activity.
Moreover, the FBR itself needs institutional reform. Without improving internal accountability, training, and efficiency, no legislative change will yield long-term results. Trust between the tax authorities and the business community is essential—and that can only be built through transparency, fairness, and dialogue, not intimidation.
Ultimately, while tax reform is crucial for Pakistan’s financial future, it must be pursued with wisdom and balance. Policies that scare away business will only deepen the economic crisis. The government must adopt a consultative approach, address genuine concerns, and ensure that any anti-evasion measures are implemented with justice and due process. A thriving business community and an efficient, accountable tax system are not mutually exclusive—they are two sides of the same coin.
