Cryptocurrency continues to remain outside Pakistan’s formal tax framework due to the absence of clear regulations by the Federal Board of Revenue (FBR), according to the Federal Tax Ombudsman (FTO) Dr. Asif Mahmood Jah. In a recent awareness session with Islamabad’s business community, the FTO highlighted serious concerns regarding the lack of legal mechanisms to bring digital currencies under the country’s tax net.
FTO Coordinator Saif-ur-Rehman shared that during the session, a complainant raised the issue of Pakistan’s significant adoption of cryptocurrency, noting that the country ranks sixth globally in crypto adoption. Despite being willing to pay taxes on earnings from digital assets, the complainant pointed out that the FBR has yet to establish rules or procedures to facilitate taxation of cryptocurrency transactions.
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In response, the FBR’s Policy Wing acknowledged that the subject of digital currencies is still under review. However, they stated that a formal position would be determined after consultation with the relevant departments. The delay in regulatory clarity has drawn criticism from the FTO, who labeled the FBR’s approach as negligent and incompetent.
The FTO expressed concern over the FBR’s attempt to question the ombudsman’s jurisdiction rather than addressing the growing issue. He underscored the urgency of establishing a formal tax and regulatory framework, given the rising scale of cryptocurrency use in the country. Pakistan’s local crypto market is expected to reach $1.6 billion in 2025, with an anticipated user base of over 27 million individuals.
To address the regulatory gap, the FTO has directed the FBR to initiate dialogue with the complainant and other stakeholders. He has also urged the tax authority to include a comprehensive framework for cryptocurrency regulation and taxation in the upcoming Finance Bill, aiming to bring transparency and legal structure to a rapidly expanding digital economy.
