Karachi, June 17, 2025 – The Sindh government has proposed a major fiscal reform in its provincial budget for 2025-26 by abolishing five longstanding levies.
These changes are part of the Sindh Finance Bill 2025, which was presented in the Provincial Assembly on June 13, 2025.
According to tax experts at PwC A.F. Ferguson & Co., the Sindh Finance Bill contains several key measures aimed at simplifying the province’s tax structure and improving ease of doing business. The Chief Minister of Sindh, while presenting the budget, announced the proposed abolition of the following levies: Professional Tax, Entertainment Duty, Drainage Cess, Cotton Fees, and Local Cess. These levies, often seen as outdated and cumbersome, are being eliminated to reduce the compliance burden on businesses and individuals across Sindh.
In addition to abolishing these levies, the Finance Bill proposes a reduction in Motor Vehicles Tax, signaling further relief for vehicle owners in the province. This move is expected to provide financial ease to the general public and promote registration compliance.
One of the most significant reforms in the Sindh Finance Bill 2025 is the proposed simplification of the Sindh Sales Tax on Services. The bill suggests the adoption of a negative list approach, under which only specifically mentioned services will be subject to tax, while all others will be exempt. This aligns Sindh’s tax legislation more closely with global best practices and enhances clarity for service providers.
Experts have noted that although the official copy of the Finance Bill has not yet been made publicly available, their analysis is based on the widely circulated unofficial version. Despite these early insights, final implementation will depend on the officially notified law.
The Sindh government’s reform-oriented approach in the Sindh Finance Bill demonstrates a strong commitment to modernizing its tax regime, encouraging business activity, and creating a more taxpayer-friendly environment. With five levies being abolished and tax procedures being streamlined, the Finance Bill is expected to bring substantial improvements to the province’s fiscal landscape.