The Federal Board of Revenue’s (FBR) notification imposing a 40% additional tax on banks’ windfall profits has been met with uncertainty as it requires approval from the National Assembly by February 19, 2024. The formation of the National Assembly is not expected until after the upcoming general elections, raising concerns about the timely implementation of the tax measure.
The FBR issued SRO 1588(I)/2023 on November 21, 2023, invoking its powers under Section 99D(2) of the Income Tax Ordinance to tax banks’ windfall profits. The notification outlines the calculation method and formula for determining the 40% tax.—INP
