The federal government, based in Islamabad, is preparing to announce significant tax reforms in the upcoming 2025 Budget. One of the key focuses is removing the Raw Material Tax. This move aims to ease financial pressures on the industrial and construction sectors.
Prime Minister Shehbaz Sharif has instructed officials to consult industry leaders to ensure they design the relief measures to meet their needs effectively. By removing the Raw Material Tax. The government hopes to stimulate the production sector and reduce operational costs for businesses, leading to a more favorable economic environment.
Sources suggest that removing the withholding tax on raw materials will reduce tax refunds. This change will make it easier for businesses to obtain essential supplies at more affordable prices.
Relief Plans for Property and Telecom Sectors
The government is considering removing the withholding tax on property deals. It is also looking into eliminating the federal tax on property transactions.
To ensure these tax reforms align with Pakistan’s economic vision, a dedicated session with the International Monetary Fund (IMF) is being organized. This session will allow for further discussions on the proposed measures.
Taking Pakistan’s economic policies into account, the government has planned a session with the International Monetary Fund (IMF). The purpose of the session is to emphasize the significance of these measures in boosting economic activity and ensuring long-term financial security.
The goal is to show how removing the Raw Material Tax and other reforms will improve the business environment. This will also support overall economic growth.
Pakistan’s telecom sector is pushing to cut the withholding tax from 15% to 8%. This move aims to encourage digital adoption nationwide.
Meanwhile, the government is also contemplating a 2.5% cut in income tax rates for salaried individuals, as part of a wider effort to provide tax relief.
Keep reading: President Approves New Law to Speed Up Stuck Tax Cases
New Tax Ordinance Brings Major Changes
Just a few days ago, President Asif Ali Zardari approved the Tax Amendments Ordinance 2025, making it effective immediately. The new law brings important changes to how taxes will be enforced in the country.
The ordinance requires taxes to be paid right away after a decision is made by the High Court or Supreme Court. The FBR now has the authority to freeze bank accounts. It can do so without prior notice or any legal formalities.
The FBR now has legal authority to collaborate with federal and provincial agencies. This adds to its existing powers and allows it to seize assets more effectively.
This allows the FBR to coordinate with other government bodies to trace and seize assets tied to tax evasion or financial crimes.
By joining forces with these agencies, the process of asset seizure becomes more coordinated and efficient. This enables a more comprehensive approach to ensuring compliance with tax laws.
