Karachi, April 14, 2025 – The Federal Board of Revenue (FBR) has revealed that it extended approximately Rs 60 billion in tax relief during the current fiscal year through reduced income tax rates applied to a wide range of imports. This relief was granted under Clause 56 of Part IV of the Second Schedule of the Income Tax Ordinance, 2001.
According to the FBR’s latest annual tax expenditure report, the reduced tax rate facility aims to support sectors crucial to the country’s economy while easing the cost burden on key industries. The FBR clarified that the exemption from the usual withholding tax under Section 148 applies to specified individuals, organizations, and types of goods brought into Pakistan through imports.
The FBR outlined a comprehensive list of entities and import categories eligible for this tax incentive:
1. Imports of goods falling under Chapters 86 and 99 of the Pakistan Customs Tariff (excluding PCT heading 9918).
2. Petroleum products, including crude oil, furnace oil, motor spirit, JP-1, high-speed diesel oil, base oil for lubricants, light diesel oil, and super kerosene oil, imported by major oil marketing companies like Pakistan State Oil, Shell, Chevron, Attock Petroleum, Total-Parco, and others licensed by OGRA, as well as oil refineries.
3. Goods imported by direct and indirect exporters under subchapter 7 of Chapter XII of SRO 450(I)/2001.
4. Temporarily imported goods that are exempt from customs duty and sales tax under SRO 492(I)/2009, including items brought in by international athletes.
5. Imports under Manufacturing Bond Schemes as detailed in Chapter XV of the Customs Rules 2001.
6. Mineral oil imported by pesticide manufacturers, exempt under SRO 857(I)/2008.
7. Imports by the Federal Government, provincial governments, and local governments.
8. Foreign companies and their associations where a majority share is held by a foreign government.
9. Imports of plant and machinery by contractors executing government projects, subject to certification.
10. Petroleum companies importing crude oil, diesel, kerosene, and chemicals used in refining operations.
11. Exploration and Production (E&P) companies under SRO 678(I)/2004, excluding imported motor vehicles.
12. Re-importation of previously exported Pakistani goods, within one year of export, per the Customs Act, 1969.
13. Plant and machinery for biomass/bagasse-based power generation projects qualifying under Clause 132C.
14. Entities authorized under the Export Facilitation Scheme 2021, subject to specific FBR-defined conditions.
15. Completely built-up (CBU) motor vehicles up to 1000cc.
16. Printed books (PCT code 49.01), excluding brochures and similar materials.
17. Newspapers, journals, and periodicals (PCT code 49.02), with or without advertising.
18. Blind talking mobile phones imported by visually impaired persons under applicable rules.
The FBR emphasized that the facilitation aims to improve trade competitiveness and incentivize industrial productivity by ensuring that essential imports are not burdened with prohibitive tax costs. These concessions also align with broader efforts to strengthen the export sector, develop domestic industries, and enhance energy infrastructure.
The decision to offer reduced income tax rates on selected imports is part of a wider framework to stimulate economic growth, attract investment, and support vulnerable sectors. The FBR reiterated its commitment to modernizing Pakistan’s tax system while ensuring that imports critical to national development receive the necessary fiscal support.
With this Rs 60 billion concession, the FBR continues to play a central role in balancing revenue collection with strategic tax incentives, ensuring that the country’s tax regime remains growth-oriented and inclusive across essential sectors.