FBR says has not breached financial privacy of taxpayers

ISLAMABAD: The Federal Board of Revenue (FBR) has not breached the financial privacy of taxpayers by sending text messages (SMS) to filers of income tax returns regarding their bank accounts and movable/immovable property transactions.

According to the FBR’s brief submitted to the Senate Standing Committee on Finance, it wishes to clarify that the purpose of the recent text messages sent to filers was to enhance taxpayer awareness and compliance through behaviorally informed nudges.

The information used in these messages pertains solely to the taxpayer’s own financial profile and is shared exclusively with the individual to whom the data belongs. No third party is ever involved in the transmission of such messages, and all communications are made through secure official channels.

READ MORE: Super Tax to be recovered in instalments: FBR announces major relief for corporate sector

It is further submitted that FBR, under the Income Tax Ordinance, 2001, is legally empowered to obtain third-party data from various institutions for the purpose of broadening the tax base and improving compliance. Specifically:

a. Section 165A of the Ordinance authorizes every banking company to furnish prescribed information to the Board, including particulars of deposits, withdrawals, and payments above defined thresholds.

b. Section 175A provides for real-time access to information and databases from designated agencies such as NADRA, FIA, SBP, provincial land authorities, electricity and gas utilities, and others, subject to confidentiality under Section 216, to be used strictly for tax purposes.

The FBR stated that all such data are held within FBR’s secure systems and used solely for the purpose of risk-based analysis and taxpayer facilitation, in strict conformity with the provisions of the law and the rules of data protection.

The FBR remains fully cognizant of citizens’ right to financial privacy and ensures the highest standards of data security and confidentiality.

The messages in question therefore do not constitute a breach of financial privacy; rather, they are part of an evidence-based approach to strengthen voluntary compliance and ensure that taxpayers are aware of their own declared and third-party-reported financial information. The FBR remains committed to cooperating with all oversight forums of Parliament and to upholding transparency, data protection, and respect for taxpayers’ rights, the FBR added.

Copyright Business Recorder, 2026