FBR announces withholding tax rates on imports for 2025-26

Islamabad, August 18, 2025 – The Federal Board of Revenue (FBR) has officially released the updated withholding tax rates applicable on imports for the tax year 2025-26.

These rates have been notified under Section 148 of the Income Tax Ordinance, 2001 (as amended), and provide a comprehensive framework for determining the tax liability on goods brought into Pakistan.

The new rates cover a wide range of categories, including taxpayers listed on the Active Taxpayers List (ATL), non-ATL filers, late filers, and commercial entities. By differentiating between these groups, the FBR aims to encourage compliance and ensure that non-filers face higher tax obligations compared to registered taxpayers.

For goods falling under the Twelfth Schedule of the Ordinance, the rates vary depending on the category of imports. Essential commodities such as raw materials, pharmaceuticals, and specialized kits like Completely Knocked Down (CKD) kits for electric vehicles have been assigned relatively lower tax rates to facilitate industries and reduce input costs. On the other hand, higher rates have been prescribed for commercial importers dealing with luxury or non-essential items.

Interestingly, specific provisions have also been included for mobile phone imports, where withholding tax is calculated based on customs classification codes. These rates range from as low as Rs. 70 for basic models to as high as Rs. 23,000 for premium smartphones, reflecting the government’s effort to generate revenue from high-end consumer electronics while keeping affordable devices within reach of the general population.

The FBR emphasized that this updated Withholding Tax Rates Card has been designed to serve as a facilitation tool for taxpayers, withholding agents, and stakeholders in the trade sector. However, it also clarified that the card cannot be used as a legal reference in statutory proceedings. In cases of dispute or contradiction, the provisions of the original Income Tax Ordinance will prevail.

By issuing these rates, the FBR seeks to strike a balance between revenue generation and economic facilitation. Tax experts believe that the categorization of imports in this manner will not only improve compliance but also provide industries with greater clarity for cost management in the year ahead.

Withholding Tax Rates on Imports – Tax Year 2025-26