Islamabad — The Federal Board of Revenue (FBR) has introduced new Standard Operating Procedures (SOPs) to streamline the process for investigating tax fraud committed by businesses and traders under Section 37A of the Sales Tax Act, 1990.
According to official instructions circulated to field formations, any case where credible evidence of tax fraud is detected must be referred to the intelligence directorate for further examination.
The intelligence directorate will review the referred cases within 30 days to determine whether a formal investigation under Section 37A should be initiated. The move aims to ensure that cases involving suspected tax fraud are assessed through a structured and transparent process before proceeding to a full investigation.
The FBR stated that the newly issued SOPs are designed to create a clear framework for preliminary inquiries and formal investigations, ensuring that proceedings remain legally sound and defensible before appellate forums.
Under the provisions of the law, authorized officers conducting investigations have powers similar to those of a civil court. These powers include summoning individuals, examining evidence, and making arrests where necessary in cases involving serious tax fraud.
If the intelligence directorate concludes after the preliminary review that a formal investigation is justified, the case will proceed in accordance with Sales Tax General Order No. 2 of 2025, which outlines the procedures for conducting fraud investigations under the sales tax regime.
The new guidelines are part of the FBR’s broader effort to strengthen enforcement mechanisms, improve compliance, and curb tax evasion in Pakistan’s business sector.
