Finance Bill Introduces Real-Time Data Matching Framework
ISLAMABAD: The Federal Board of Revenue (FBR) has proposed a new digital monitoring mechanism under the Finance Bill 2026-27 aimed at strengthening tax compliance through real-time integration of banking and tax records.
Under the proposed Section 165AB, all banking companies and Electronic Money Institutions (EMIs) will be required to electronically submit specified account information to a Central Data Hub. The system will automatically compare financial activity with declared income and tax records to identify potential cases of tax evasion.
According to the proposal, the mechanism will operate regardless of existing provisions in financial laws, including the Banking Companies Ordinance 1962 and the State Bank of Pakistan Act 1956.
The FBR says the initiative will improve transparency, enhance documentation of the economy and help authorities detect discrepancies between reported income and actual financial transactions.
High-Value Accounts to Face Enhanced Reporting
Under the proposed framework, banks will report detailed information for account holders whose cumulative deposits or withdrawals exceed Rs100 million during a six-month reporting period.
The data will include opening and closing balances, peak credit amounts and total transaction volumes across all accounts held by an individual. Furthermore, the information will be processed through automated systems designed to identify irregularities without direct human intervention during the initial review stage.
If significant mismatches emerge between financial activity and tax declarations, the case will automatically move to the Compliance Risk Management (CRM) system for further examination and potential enforcement action.
State Bank to Manage Secure Data Repository
Meanwhile, the bill proposes a structured reporting cycle divided into two periods: July to December and January to June. Financial institutions will submit data in January and July respectively.
In addition, the proposed legislation formally defines key banking terms such as “accounts” and “peak credits” to ensure uniform reporting standards.
The proposal also authorizes the State Bank of Pakistan to establish and maintain a secure banking data repository. Authorities say the platform will facilitate regulated data sharing, strengthen financial oversight and support the government’s broader efforts to combat tax evasion through technology-driven solutions.
