The Federal Board of Revenue (FBR) is set to finalize the Finance Bill for 2025-26, introducing approximately Rs. 200 billion in new tax measures. Key changes include an 18 percent sales tax on the import of solar panels and on e-commerce transactions.
FBR has reviewed the Sixth Schedule (exemptions) and Eighth Schedule (reduced rates) of the Sales Tax Act, with plans to remove several exemptions and concessionary rates. However, some cancer-related medical equipment and lifesaving drugs will be added to the tax exemption list as partial relief.
Additionally, the sales tax net will be broadened to include services provided within the Islamabad Capital Territory, and an 18 percent sales tax will be applied to goods manufactured in the ex-tribal areas.
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The Third Schedule of the Sales Tax Act, which enforces taxation based on printed retail prices, will be expanded to cover more imported products such as chocolates, coffee, cereals, frozen foods, chips, carbonated drinks, instant noodles, ice cream, biscuits, frozen meat, sauces, ready-made meals, and sausages.
These tax reforms are expected to be included in the fiscal year 2025-26 budget.
