There’s good news for Pakistan’s business community. The Federal Board of Revenue (FBR) has officially announced that arrests in sales tax cases will only happen in cases involving fake or flying invoices.

This important update came through a special FBR circular, putting to rest growing concerns from business owners who felt they were being unfairly targeted under tax laws. FBR has now made it clear: only serious tax fraudsters, caught using fake invoices, will face arrest.

Officials further explained that arrests will only be allowed under specific conditions—such as if someone tries to destroy evidence, hides from authorities, or ignores three official notices.

The FBR is also preparing a new Sales Tax General Order (STGO) that will clearly define when and how an arrest can be made. The aim is to ensure that enforcement is based on rules, not fear.

In another major shift, the FBR has decided to separate criminal and civil tax matters. If someone is not paying taxes due to fraud or working with others to cheat the system, legal action will be taken. But if it’s just a late filing or a procedural issue, it will now be treated as a civil matter under Section 11E—with no arrest, only proper legal steps.

Tax experts and business leaders are welcoming these changes, calling them a positive step toward fair and balanced tax enforcement. It gives genuine taxpayers peace of mind while still holding fraudsters accountable.

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