The Federal Board of Revenue (FBR) has proposed a 10 percent sales tax on goods manufactured in the ex-tribal areas as part of revenue-boosting measures under the upcoming federal budget, according to informed sources.

Additionally, FBR has recommended ending the sales tax exemption on the import of plant, machinery, and inputs by industrial units operating in the erstwhile FATA and PATA. These items, previously exempt under the Sixth Schedule of the Sales Tax Act, will now be subject to taxation starting next fiscal year.

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These proposals are designed to enhance direct tax collection in line with the government’s ambitious Rs. 14.3 trillion tax revenue target for the fiscal year beginning in July.

The move is part of commitments made to the International Monetary Fund (IMF), as the government seeks to strengthen tax revenues and align them with a larger share of the national GDP.