27 million Crypto users are still un-Taxed in Pakistan because of Regulatory inaction

Crypto tax in Pakistan remains a grey area, with the Federal Board of Revenue (FBR) yet to establish a clear framework for taxing digital assets. Despite Pakistan ranking among the top global adopters of cryptocurrency, regulatory delays have allowed the booming crypto market to operate outside the country’s tax net, raising major concerns among stakeholders.

Federal Tax Ombudsman (FTO) Dr. Asif Mahmood Jah recently criticized the FBR for its continued inaction during an awareness session with Islamabad’s business community. Highlighting the urgent need for reform, FTO Coordinator Saif-ur-Rehman shared that a complainant approached the agency, expressing a willingness to pay taxes on crypto earnings. However, the FBR currently lacks the necessary laws and procedures to facilitate crypto tax in Pakistan.

In response, FBR’s Policy Wing admitted that cryptocurrency is a relatively new field under review. Still, no concrete measures or policies have been announced to regulate or tax digital currencies. The FTO expressed concern that large-scale cryptocurrency transactions continue outside the formal tax system, primarily due to the FBR’s negligence and lack of preparedness.

The crypto market in Pakistan is expected to reach $1.6 billion in 2024, with over 27 million users projected by year-end. Despite this massive adoption, the absence of clear rules for crypto tax in Pakistan is causing revenue losses and regulatory gaps. The FTO has now directed the FBR to consult all stakeholders and introduce a comprehensive crypto taxation framework in the upcoming Finance Bill.

Until such regulations are formalized, cryptocurrency trading in Pakistan will continue to operate in legal limbo, depriving the country of a potential new source of tax revenue while leaving investors without regulatory protections.