Islamabad, June 19, 2025: In a major policy shift, the Federal Board of Revenue (FBR) has proposed abolishing the Seventh Schedule of the Income Tax Ordinance 2001, aiming to bring banks under the standard corporate tax framework.
FBR Chairman Rashid Mahmood Langrial informed the Senate Standing Committee on Finance that financial institutions should be taxed like regular companies. He emphasized that the current special tax treatment for banks, which has been in place since 2007, no longer aligns with the government’s broader tax reforms.
The proposal was discussed and approved during the committee’s review of the Finance Bill 2025-26, chaired by Senator Saleem Mandviwalla. FBR Member Inland Revenue (Operations), Hamid Atiq Sarver, provided a detailed explanation of the legal and operational impact of this amendment.
Chairman of the Securities and Exchange Commission of Pakistan (SECP), Akif Saeed, supported the move, confirming that banks are registered as regular corporate entities. He agreed with the view that there should be a uniform tax policy across all sectors.
Senator Mandviwalla also voiced his dissatisfaction with the performance of FBR’s anomaly committees and backed the call to repeal the Special Economic Zones (SEZ) Act. He highlighted that no new tax exemptions are being issued, making the act obsolete.
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Additionally, Mandviwalla supported FBR’s recommendation to cap taxpayer audits at a three-year period, a step intended to improve compliance and reduce unnecessary scrutiny.
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