Faceless taxman

IN June 2026, Prime Minister Shehbaz Sharif approved a New Tax Operating Model — launched this month — to adopt a centralised, digital ‘faceless’ system that replaces individual tax officers with one that has sweeping authority over taxpayers’ cases. Cases will be allocated via an algorithm, and the hearings will move online. The goal is to end direct, discretionary contact between officials and taxpayers, which has long been accused of harassment, bribery, and outright collusion. It remained only a policy announcement until the Finance Bill 2026 , which took effect on July 1, 2026, gave the model legal force by amending the Sales Tax Act, the Income Tax Ordinance, and the Customs Act.

But the amendments did not create any new or required procedural rights for taxpayers specific to the faceless context and routed existing appeal mechanisms, adopting whatever weaknesses and strengths they already had. This reform responds to a serious problem, as the FBR cites in support of the plan: 8,697 individuals holding a combined Rs750 billion in bank deposits reported zero income. Centralisation of audit selection through an algorithm is a defensible response to this reality. But this reform leaves one question unanswered: if a business is assessed, penalised, or denied a refund under an algorithmic case allocation system, what does the business get in return? What does due process look like when an anonymous unit makes the decision? It is tempting to view a ‘faceless’ system as the equivalent of a ‘fair’ system. This improvement is genuine and welcome, as most complaints filed on the Pakistan Citizen’s Portal show just how badly things work for ordinary taxpayers. Digitising the process is reasonable. But discretion does not disappear when a human officer is replaced with a…