FBR Seeks Tax Proposals for Budget 2025-26

ISLAMABAD: The Federal Board of Revenue (FBR) has sought income tax, sales tax and federal excise duty budget proposals (2025-26) from Inland Revenue field formations as well as business and trade bodies for removal of tax distortions, procedural lapses and anomalies. 

The FBR’s instructions to the field formations on Wednesday stated that the FBR has invited budget proposals for the upcoming budget for 2025-26 relating to Income Tax, Sales Tax, Federal Excise Duty and ICT (Tax on Services) Ordinance, 2001. 

FBR said that in order to enhance the budget formulation process and to reduce backend procedural burdens, the Federal Board of Revenue (FBR) plans to commence its budget process earlier this year. As a plan, the FBR has started developing proposals for the Finance Bill, 2025. In pursuit of leveraging the collective expertise and insights of all stakeholders to refine tax policies, the FBR has invited proposals for the forthcoming Budget for the Fiscal Year 2025-26. 

The FBR is seeking suggestions in the following policy areas:

(i) Broadening of tax base for a wider participation in revenue generation efforts. 

(ii) Policy suggestions for bringing entire value chain of all businesses in GST regime. 

(iii) Promoting progressive taxation by introducing various measures where incidence of tax is higher on affluent classes. 

(iv) Phasing out of tax concessions and exemptions under all tax laws. 

(v) Facilitation of taxpayers and ease of doing business by removal of redundancy and simplification of tax laws. 

(vi) Measures to reduce tax arbitrage opportunities and infuse efficiency in economy by following neutrality principle in taxation.

(vii) Removal of tax distortions, procedural lapses and anomalies. 

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The areas identified above are just illustrative and not exhaustive. The proposals are expected to be clear, meaningful and implementable though addition, deletion, or further amendments to the tax laws, FBR said. FBR has asked to submit the proposals by January 31, 2025.