Toshakhana reforms tighten rules on official gifts

The federal government has tightened the rules governing gifts received by public office holders, ending

ISLAMABAD: The federal government has tightened the rules governing gifts received by public office holders, ending the previous route for retaining gifts worth up to $300 by paying their assessed market value. However, a committee will retain the authority to exempt certain expensive, historically significant and diplomatically sensitive gifts from public auction.

The Toshakhana (Management and Regulation) Rules, 2026, introduce a revised framework for receiving, valuing, recording and disposing of gifts presented to government officials. The new rules require gifts that cannot be declined for diplomatic or cultural reasons to be deposited in the Toshakhana, the state repository for official gifts.

Under the revised framework, gifts eligible for disposal will generally be sold through open public auctions. However, antiques and items of historical or cultural importance are excluded from auction. Other high-value gifts and presents considered diplomatically or internationally sensitive may also receive exemptions.

These decisions will rest with a committee headed by the cabinet secretary. Its members will include senior representatives from the Finance, Foreign Affairs, Law and Culture divisions.

The committee’s role is significant because the classification of gifts will determine which items enter the auction process and which remain exempt. However, exemption from auction does not automatically grant the original recipient the right to keep a gift for personal use.

The previous Toshakhana procedure, introduced in 2023, also restricted the private retention of gifts valued above $300, making them state property. It excluded antiques and items with intrinsic historical value from the retention concession and provided for periodic public auctions of gifts unsuitable for retention, donation or official display.

The 2026 rules also introduce stricter valuation procedures to improve accountability. The Federal Board of Revenue and an independent private-sector evaluator will assess each gift’s market value. If their valuations differ by more than 25 per cent, a third evaluator will be appointed.

Valuations older than three months cannot be used to establish the reserve price for an auction. The reserve price must also be no lower than the gift’s assessed market value.

To strengthen transparency, the new framework requires open auctions and prohibits public office holders and their family members from participating in the bidding process. Auctions will also be subject to live media coverage.

Details of gifts, including their assessed values, reserve prices and final auction prices, will be published on an online portal updated every month. However, the identities and countries of the dignitaries who presented the gifts will not be disclosed on the portal.

The rules further require annual third-party audits of gifts received and disposed of through the Toshakhana. Revenue generated from auctions will be deposited into a separate account dedicated to supporting primary education for girls in the country’s least-developed areas.

The revised framework places greater emphasis on preventing the private retention of official gifts and ensuring that their disposal follows documented procedures. Nevertheless, the exemptions available for valuable and sensitive items mean that the committee’s decisions will remain central to the implementation of the policy.

The effectiveness of the new system will ultimately depend on the consistent application of exemption criteria, transparent handling of gifts kept outside the auction process and proper public accounting of state assets.