Islamabad:
On Thursday, the Senate Finance Committee was informed that the federal government has decided to abolish tax exemptions for special economic zones (Sez) and special technological zones (STZ) in line with the IMF conditions.
During a meeting chaired by Senator Salem Mandviwalo on Thursday, the president of the Federal Income Board (FBR), Rashid Mahmood Langial, informed the committee that, according to the IMF agreement, all tax exemptions must be eliminated by 2035.
He said that in the future, no Sez or Stz will receive any form of fiscal relief. “Our hands are tied,” Langial said, added that fiscal concessions and reduced rates are withdrawn in several sectors.
The Committee rejected the budget proposals for the next fiscal year, including the imposition of a carbon tax of RS2.50 per liter in products derived from oil, eliminating the limit of 10 percent on the surcharge of the debt service for electricity consumers and introducing a tax in small vehicles. The senators described these measures as a burden to the public.
With respect to the Autonomous Entities of the Public Sector, Senator Anusha Rahman raised concerns about the institutions that maintained large investments despite the minimum personal.
She cited the example of the Evacuee Trust (ETPB) Board, which she is only administered by only 12 people, but has RS13 billion invested. She questioned why such institutions are allowed to retain and invest their income and requested reforms or exemptions in the Public Finance Management Law (PFMA) if necessary.
The officials responded that agencies such as Nadra, CDA and Karachi Port Trust can invest their funds and obtain profits, and pay taxes on these profits. However, the president of the committee said that none of these institutions had recently paid taxes.
The officials informed the committee that Nadra had paid a tax that amounted to RS8 billion during the last two years.
The FBR chief proposed amendments to the PFMA, but the committee opposed them, insisting that the income of all the agencies owned by the government must be deposited in the federal consolidated fund.
The Ministry of Finance declared that the proposed amendment would allow autonomous agencies to retain and spend their income independently, but Anusha Rahman firmly opposed, demanding that such entities remain responsible to the National Treasury and seek balances of such institutions.
The committee also reviewed the changes proposed to property taxes. According to FBR officials, tax retaining taxes valued at RS1 billion has increased from 8 percent to 9.5 percent, while properties worth less than 100 million will be taxed at 8.5 percent. For properties valued below RS50 million, the rate will be 7.5 percent.
In addition, the 2025 Finance bill includes stricter measures against non -filters. While the property purchase tax for non -filters has been reduced, the load has changed to sellers.
The Committee approved a proposal to impose a 5 percent tax on foreign online platforms.
