Islamabad, July 5, 2025 – In a bold and business-boosting decision, Islamabad has rolled out a major concession for the logistics industry, slashing the sales tax rate on freight forwarding services as part of its fiscal reforms for 2025–26.
The Federal Board of Revenue (FBR) has officially updated the Islamabad Capital Territory (Tax on Services) Ordinance, 2001, incorporating major amendments introduced through the Finance Act, 2025. The spotlight of this revision is the strategic reduction in sales tax for freight forwarding agents and packers and movers operating in Islamabad.
Under normal conditions, a 15% sales tax applies to services offered by freight forwarding companies, including logistics handlers and movers. However, the FBR has introduced a sensational concession for the industry: a reduced tax rate of just 5%, or Rs. 1,000 per bill of lading—whichever is higher.
But there’s a twist! This discounted rate comes with a specific caveat—no input tax adjustment or refund will be allowed for those who opt for the lower tax regime. Despite the limitation, industry experts are hailing this move as a breath of fresh air for the logistics sector in Islamabad, which has long struggled with high tax burdens and rising operational costs.
With global trade and local logistics becoming increasingly vital to the national economy, this tax cut is expected to energize freight operators in Islamabad, boost competitiveness, and encourage formal registration of services under the tax net.
The decision is being seen as a smart maneuver to attract more freight forwarding businesses to Islamabad, solidifying its position not only as the political capital but also as a rising logistics hub. Industry leaders anticipate that this will translate into lower shipping costs, smoother operations, and better service delivery across the board.
As Islamabad continues to modernize its economic landscape, this freight-friendly initiative signals that the capital is ready to support dynamic sectors with smart, growth-oriented policies.