FBR Tightens Spending Rules for Tax and Customs Offices

Federal Board of Revenue (FBR) has introduced stricter conditions for Inland Revenue and Customs field formations seeking recurrent budget funds for the fiscal year 2026-27, warning officials against unauthorized spending and budget overruns.

According to instructions issued by the FBR on Monday, heads of departments and field offices will be personally responsible for ensuring that approved budgets are implemented properly and in line with all applicable financial laws and regulations.

These include the Public Finance Management Act, 2019, General Financial Rules, Financial Regulations, Treasury Rules, and directives issued by regulatory authorities and the FBR headquarters.

The tax authority said a review of the SAP Budget Execution Report for the fiscal year 2025-26 found that several offices incurred inadmissible expenditures, resulting in overdrafts against their approved budget allocations under different heads of account.

The FBR warned that the heads of the concerned departments or offices, controlling officers, and Drawing and Disbursing Officers will be held personally accountable for any violation of the prescribed financial framework. Such cases may also lead to disciplinary action under the Efficiency and Discipline Rules.

The directive further stated that offices responsible for unauthorized spending will not be eligible for budget reappropriation or additional funds until the excess payments have been adjusted or recovered.

To strengthen financial oversight, the FBR instructed all field formations to establish an effective system for monitoring monthly expenditures and budget allocations. It said the reconciliation process should cover not only recorded expenditures but also original budget allocations, approved reappropriations, surrendered funds, supplementary grants, monthly and cumulative spending, and the remaining available budget before reports are submitted to the Board.