FBR requires Inland Revenue officers to document audit observations and findings after considering taxpayers’ explanations. ISLAMABAD: The Federal Board of Revenue (FBR) has introduced a requirement for Inland Revenue officers to issue a complete audit report containing their observations and findings after completing sales tax audit proceedings. The FBR issued Circular No. 1 of 2026 to explain key amendments to the Sales Tax Act, 1990, introduced through the Finance Act, 2026. According to the circular, the previous Section 25 of the Sales Tax Act, 1990, did not require an Inland Revenue officer to issue a formal audit report after completing audit proceedings. However, a new sub-section (8B) of Section 25 has now been inserted, requiring the Inland Revenue officer to issue an audit report containing the audit observations and findings. The report must be issued after obtaining the registered person’s explanation on all issues raised during the audit. The amendment is intended to improve transparency in the sales tax audit process by formally documenting the findings of tax authorities while ensuring that taxpayers’ explanations are considered before the audit report is finalised. Commissioner empowered to order re-audit The FBR has also introduced a new sub-section (8A) of Section 25, empowering the…