More than a year after Section 114C was introduced through the Finance Act, 2025, the restrictions contemplated under the provision have not yet become operational. The Federal Government has not notified the effective date, while the FBR has also not issued the detailed rules required for practical implementation.
The provision is intended to restrict certain high-value transactions by persons who do not satisfy the prescribed tax compliance and financial-capacity requirements. The specified transactions include motor vehicles valued above Rs7 million, immovable property exceeding Rs100 million, investments in securities and similar instruments above Rs50 million in a financial year, and annual cash withdrawals exceeding Rs 100 million.
An individual would generally qualify as an eligible person by filing the income tax return for the immediately preceding tax year and demonstrating sufficient declared financial resources to support the proposed transaction. Until the required government notification and operational rules are issued, however, banks, property registrars, vehicle registration authorities and financial institutions do not have the complete legal framework necessary to enforce these restrictions.