ISLAMABAD, Aug 30, 2025 – The Federal Tax Ombudsman (FTO) has ordered the Federal Board of Revenue (FBR) to immediately refund the unlawfully deducted income tax from a Kuwaiti diplomat, terming the act as maladministration.
Despite enjoying diplomatic immunity under international law, the diplomat faced repeated deductions by his bank on the basis of being a “non-filer.” In his complaint, he argued that he had no taxable income in Pakistan and was exempt from registration or filing requirements under the Income Tax Ordinance, 2001 and the Vienna Convention on Diplomatic Relations.
The FTO noted that such deductions not only violated domestic law but also infringed upon diplomatic privileges. It directed the FBR to refund the deducted amount within 20 days and report compliance within 30 days.
Previously, a similar case involving the Brazilian ambassador was resolved, where withholding tax was refunded after it was established that the diplomat had no local taxable income.
The ruling underscores the FTO’s critical role in safeguarding taxpayer rights, addressing maladministration, and ensuring compliance with international treaties, while directing the FBR to issue proper instructions to prevent such violations in the future.
