ISLAMABAD – The federal budget for FY 2025–26 brings a major shake-up in taxes, tariffs, and incentives, with a clear focus on fiscal tightening, boosting exports, and bringing more and more Pakistamis into formal tax net.
Whats Going Up
Income Taxes for High Earners. Wealthy pensioners now face a 5% tax. Dividend and profit income taxes increased. Withholding taxes raised for non-filers and service providers.
Imported Solar Panels
Tax exemption on solar panels and modules withdrawn, likely raising prices.
Cash & Digital Transactions
Higher withholding taxes on non-filers for cash withdrawals (now 0.8%). E-commerce and courier services to collect 2% sales tax on orders.
Imported Food
Imported packaged food items to face full retail-stage taxation.
Banking restrictions
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FBR can now freeze bank accounts, seal premises, and block tax credits.
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Up to 2,000 auditors can be hired to tighten audits.
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Non-filers: Face higher taxes and stricter penalties.
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E-commerce platforms: Must register and share seller data.
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Importers of consumer goods: Many no longer enjoy reduced duties.
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High-income individuals: Now taxed more on cash, dividends, and savings.
What’s Going Down
Retail Tax Burden on Salaries
Tax relief is offered for salaried individuals earning up to Rs 3.2 million annually.
Excise Duty on Property Transfers
Federal Exise Duty on immovable property transfers has been abolished.
Tariffs on Raw Materials
Custom duties cut across 2,624 items to help local industry. Zero-rating now applies to over 3,100 products, including 916 new entries. Additional customs duties (ACDs) and regulatory duties (RDs) also reduced or removed on many items.
Relaxation on Super Tax
Firms earning between Rs 200–500 million will pay only half the super tax. Import and lease of aircraft are now tax-free to support PIA’s privatization.
Budget 2025-26: How much Tax will Non-Filers pay on Cash Withdrawals after tweaks?
