ISLAMABAD: The Economic Policy and Business Development (EPBD) Board of Governors has strongly opposed the controversial amendments introduced in Budget 2025, terming them a direct assault on economic freedom and the rights of Pakistan’s business community.

In a strongly worded statement, the Board categorically rejected the unprecedented and excessive powers granted to the Federal Board of Revenue (FBR), warning that such policies threaten to dismantle the country’s already fragile business environment.

“This is not tax policy—this is institutionalized harassment,” the Board said.

The EPBD criticized the transformation of FBR into a quasi-policing agency under the Anti-Money Laundering Act, 2010, where its Directorate General of Intelligence and Risk Management-Customs now exercises powers that presume every businessman is a suspect rather than a contributor to national progress.

Key concerns raised by the EPBD include:

  • Mandatory e-bilty system (Section 83C): Introduces a sweeping digital surveillance system with fines up to Rs1 million, imprisonment of up to six months, and confiscation of goods for non-compliance.
  • Section 37AA: Permits arrests without warrants based merely on suspicion of tax fraud.
  • Section 14AE: Allows arbitrary seizure of business property without checks and balances.
  • Section 37B: Authorizes 14-day detention of businesspersons, extendable by magistrates.
  • Section 11E: Enables tax assessment and recovery based solely on suspicion.
  • Section 33 (13, 13A): Imposes 10-year jail terms and Rs10 million fines for vaguely defined “tax fraud.”
  • Section 32B: Delegates quasi-legal powers to private auditors, undermining due process.

“These amendments criminalize normal business practices, create a climate of fear, and are wholly incompatible with democratic norms,” said the Board.

Additionally, no incentives for industrial growth or investment were introduced, while interest rates remain at 11 per cent—the highest in the region—making survival difficult for local businesses.

The Board noted the total effective tax burden on Pakistani businesses is now between 50-60 per cent, factoring in corporate tax, dividend tax, super tax, withholding tax, sales tax, and duties—making Pakistan one of the most hostile environments for business in South Asia.

EPBD’s Key Demands:

  1. Complete withdrawal of arbitrary enforcement powers granted to FBR.
  2. Reduction of the policy rate to 6% to support economic revival.
  3. Overhaul of the tax system to end punishment of compliant businesses.
  4. Implementation of pro-growth policies to attract investment and reduce unemployment.

The Board warned that if the government fails to revise the Finance Bill 2025, the business community may have no option but to halt operations in Pakistan.

“If the government believes it can collect taxes without taxpayers, let it try. If FBR thinks it can run the economy without businesses, let them try,” the statement concluded.

The EPBD called on the government to choose economic revival over authoritarianism, noting that without a thriving private sector, Pakistan’s economy will collapse under the weight of its own policies.