FBR to Adjust Input Tax Limits from July 1

Islamabad, July 14, 2025, 07:23 PM PKT — The Federal Board of Revenue (FBR) is set to roll out a transformative adjustment of input tax limits for registered taxpayers starting July 1, 2025, leveraging a data-driven, automated risk management system to tighten control over tax adjustments, per official announcements. Under the Finance Act 2025, the FBR gains authority to set higher or lower input tax limits for sales taxpayers, enabling input tax deferrals to boost compliance and manage risks effectively, rooted in Section 21(s) of the Income Tax Ordinance (ITO).

Taxpayers can challenge adjustments by filing with the Commissioner within 30 days, with a 30-day decision window, aiming to streamline tax administration and enhance collection efficiency. Web context highlights automation trends in tax systems, while posts found on X show concern—some welcome efficiency, others fear arbitrary changes. Critically, the narrative of “improved compliance” may mask implementation risks—web data points to system teething issues, and X sentiment suggests distrust in fair execution, hinting at potential disputes.