As Pakistan enters a decisive phase of economic restructuring, a comprehensive slate of FBR tax proposals is being finalized for presentation to the visiting IMF mission. These FBR tax proposals aim to strengthen revenue generation, widen the tax net, and modernize fiscal policy as part of the government’s upcoming FY2025–26 budget package.

E-Commerce Platforms May Face Higher Withholding Rates Under FBR Tax Proposals

One of the most notable FBR tax proposals under review involves increasing the 0.25 percent withholding tax on major online marketplaces such as Daraz, OLX, PakWheels, and Zameen. With Pakistan’s digital economy expanding rapidly, the FBR believes that enhanced e-commerce taxation could provide a measurable boost to revenue collection while meeting IMF requirements for tax base expansion.

FBR Tax Proposals Include Plan to Roll Back the 10% Super Tax

In a bid to revive business sentiment, the FBR tax proposals include a structured rollback of the 10 percent super tax imposed on large corporations. The levy has pushed effective tax rates in key sectors—including banking, tobacco, oil, cement, and telecom—close to 39 percent. The FBR argues that unwinding the tax could help clear over Rs. 200 billion currently tied up in litigation and restore investor confidence.

Major Relief for Salaried Class Expected Under FBR Tax Proposals

The government is also preparing generous relief measures for salaried individuals as part of the FBR tax proposals. The monthly income threshold for zero tax may rise from Rs. 50,000 to Rs. 80,000, effectively exempting annual earnings up to Rs. 960,000. Additionally, the proposed removal of the 10 percent surcharge on ultra-high earners could signal an effort to streamline tax compliance and reduce anomalies in the system.

Related: FBR Pakistan: Recovers Rs. 840 Million from ATS Synthetics in Major Tax Drive

Controversial Pension Tax Sparks Debate Within FBR Tax Proposals

However, not all components of the FBR tax proposals are being welcomed. A sensitive proposal to introduce a 5 percent income tax on pensioners has triggered strong pushback from retired public servants and unions. Policymakers argue the measure could help improve tax equity, but critics warn it may burden already vulnerable citizens amid rising living costs.

Manufacturers and Real Estate Sector Seek Relief in FBR Tax Proposals

Alongside revenue-raising measures, the FBR tax proposals include significant incentives for real estate developers and industrial manufacturers. These discussions involve withdrawal of withholding taxes on raw material imports, reduced taxes on property transactions, and a revised duty structure on vehicles. Imported vehicles may see lower duties, while locally assembled cars exceeding 1300cc could face higher levies to encourage fair competition.

IMF Talks Will Determine Final Shape of FBR Tax Proposals

Despite the breadth of reforms, officials within the FBR acknowledge that meeting the Rs. 12.3 trillion revenue target for next year will remain difficult without aggressive enforcement and digitalization. The upcoming IMF negotiations are expected to scrutinize the credibility and long-term viability of these FBR tax proposals, focusing on structural reforms, transparency, and sustainable revenue pathways.