The Federal Board of Revenue (FBR) has introduced a mechanism for electronic scrutiny of sales tax returns and online intimation of discrepancies detected through its computerized system. Through S.R.O. 1655(I)/2026, issued on Saturday, FBR amended the Sales Tax Rules, 2006, by inserting a new Chapter XII-A titled “Procedure for Electronic Scrutiny and Intimation of Issues Detected by the Computerized System.” The new chapter applies to automated scrutiny, analysis, and cross-matching of sales tax returns and other available data relating to registered persons through the computerized system that FBR has implemented, and it sets out how the results of that automated review will be communicated to taxpayers.
Under the new procedure, the computerized system may issue online advice or advance intimation through the IRIS portal, identifying factual or legal mistakes and discrepancies and giving registered persons an opportunity to clarify the issues, rectify errors, or take corrective action before any legal or penal proceedings begin. The advance intimation may also be issued by the Officer of Inland Revenue who has jurisdiction over the registered person. A taxpayer will be given at least seven days to respond, rectify the discrepancies, or take other corrective action, and if there is no response within that period, the system will issue a reminder with a further response window of not less than seven days. This two-step notice structure is intended to give taxpayers a chance to fix problems in their returns before the matter reaches an enforcement officer, rather than discovering the discrepancy only when action has already been initiated.
The rules also spell out how the process will be recorded and supervised. The record of discrepancies detected, intimations issued, and responses received will be communicated to the concerned Inland Revenue officer and maintained on the system dashboard, creating a documented trail for each case. The automated scrutiny and electronic communication process will be implemented through Change Request Forms (CRF), which govern how changes to the system are requested and approved. Once a taxpayer responds, the concerned Inland Revenue officer will examine the response and take appropriate action where required under the relevant provisions of the Sales Tax Act, 1990, and the rules made under it, meaning the system flags and communicates issues but decisions on further action remain with a human officer.
The mechanism adds to a series of digital enforcement and compliance measures FBR has rolled out in recent weeks. Only days earlier, reports emerged that FBR had begun suspending the sales tax registrations of taxpayers who failed to integrate with the electronic invoicing system, a step that drew criticism from tax experts over proportionality and procedural safeguards. FBR has also set up a National Faceless Centre to remove direct contact between taxpayers and officers during audits and assessments. Taken together, these steps show the board moving toward a model in which data matching, notices, and responses are handled through IRIS, with the advance intimation window in the new sales tax rules offering taxpayers a defined opportunity to correct their returns before penalties or formal proceedings follow.
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