FBR Takes a U-Turn on Property Declaration in Income Tax Return Forms

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September 28, 2025

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FBR Reverses Stance: “Estimated Fair Market Value” Column Dropped from Tax Returns

In a notable policy reversal, Pakistan’s Federal Board of Revenue (FBR) has decided to remove the “Estimated Fair Market Value” (EFMV) column from its income tax return forms this year. The decision follows strong pushback from taxpayers and detailed scrutiny by a high-level government committee. ProPakistani

Pakistan tax authority reverses policy

Earlier, the FBR had introduced a new requirement in the IRIS tax filing system, asking taxpayers to declare the estimated market values of their movable and immovable assets. The move aimed primarily to enhance data collection for macroeconomic analysis rather than to alter tax assessments. ProPakistani

However, this additional column was met with significant criticism from various quarters — many viewed it as burdensome, intrusive, and confusing.

In response, the federal government formed a committee chaired by Law Minister Senator Azam Nazeer Tarar to reexamine the proposal. The panel included key figures such as the ministers of finance and petroleum, the attorney general, the FBR chairman, and other senior officials. ProPakistani

After intense deliberations, the committee underlined the complications introduced by the EFMV field and recommended its removal to simplify the filing process. ProPakistani

Prime Minister Shehbaz Sharif promptly approved the recommendation. In an official statement, the FBR confirmed it would drop the EFMV column from this year’s tax returns. ProPakistani

Importantly, the board clarified that the column was never meant to affect income assessment or tax liability — it was intended only as a data-gathering mechanism to support the Economic Survey.

ProPakistani

Implications and Reactions

Income tax return changes Pakistan 2025

The removal of the EFMV field will certainly be welcomed by many taxpayers, especially property owners and holders of substantial assets, who viewed the requirement as complicating their filings and potentially exposing them to valuation disputes. The government’s decision helps ease compliance burdens at a time when filing timelines are pressing: the deadline remains September 30, 2025. ProPakistani

However, some observers caution that eliminating the EFMV column may limit the FBR’s ability to gather timely and relevant data on asset holdings across the country — data that can be useful for macroeconomic planning, wealth taxation debates, or measuring inequality. The board will have to weigh alternative means for data collection if it still wants to monitor asset growth trends.

Critics on social media have warned that the change might give more leeway for underreporting or misdeclaration of property values, particularly by high-net-worth individuals. One commenter sarcastically noted that “the rich can hide their land valuation during debt financing … while avoiding taxes.”ProPakistani

Whether these risks materialize depends on enforcement rigor and data cross-checks via other regulatory or financial disclosures.

Looking Ahead: What to Watch

Going forward, the FBR may explore more indirect or less burdensome ways to collect asset data — for instance, through linking with property registration authorities, banking disclosures, or real estate transaction records. The tax authority may also consider gradual or phased introduction of valuation reporting in future cycles, possibly targeting only high-value taxpayers.

For now, the reversal underscores a recognition by policymakers that tax administration reforms must balance better data collection with ease of compliance and taxpayer confidence. Whether this decision will improve tax morale, compliance rates, and data integrity remains to be seen.

Taxpayers are advised to file their returns as usual, truthfully and before the deadline of September 30, 2025, without filling in the EFMV column.

ProPakistani