ISLAMABAD – As cryptocurrency gains traction globally, many nations have integrated digital assets into their financial systems, where transactions are decentralized and securely recorded.
In Pakistan, amid rising crypto activity, the Federal Tax Ombudsman (FTO) has urged the Federal Board of Revenue (FBR) to clarify its stance on taxing income and ownership related to virtual currencies. The move follows a complaint from a local crypto user, highlighting the lack of a structured tax policy despite Pakistan ranking sixth in global crypto adoption with over 9 million users.
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Responding under Section 10(1) of the FTO Ordinance, 2000, the FTO called on the FBR to examine the tax consequences of crypto transactions. The complainant noted that while the State Bank of Pakistan (SBP) has not declared cryptocurrencies illegal—a position upheld by the Sindh High Court—the sector remains unregulated and untaxed.
Despite repeated notices, FBR’s policy division did not attend the hearings. In a written reply, FBR claimed crypto taxation falls beyond the FTO’s jurisdiction, a view the FTO dismissed, calling it an instance of maladministration.
The FTO criticized the FBR’s inaction, labeling it “gross negligence and incompetence,” and stressed that large volumes of untaxed crypto transactions must be documented and brought under regulation.
