The Islamabad High Court (IHC) Tuesday issued a significant ruling barring the federal government from blocking the SIM cards of non-tax filers, a move aimed at enhancing tax compliance.

Chief Justice Aamir Farooq issued the order in response to a writ petition filed by a telecom operator, challenging Clause 114-B of the Income Tax Ordinance and the Federal Board of Revenue’s (FBR) Income Tax General Orders targeting non-filers.

The court’s decision, scheduled for a further hearing on May 27, 2024, comes amidst a broader legal debate over the balance between tax enforcement measures and individual rights. The petitioner argued that the government’s newfound authority infringed upon the fundamental right to freedom of business as guaranteed by Article 18 of the Constitution.

The FBR’s initiative aimed to block the SIM cards of over 506,000 identified non-compliant taxpayers across the nation, with the goal of increasing tax revenue. However, telecom companies raised concerns over technical and operational obstacles in implementing the FBR’s directives, leading to legal complexities.

The outcome of the upcoming hearing is expected to shape the trajectory of this debate, determining the extent to which the government can enforce tax compliance through measures impacting individual liberties.