ISLAMABAD – National Assembly has approved the federal budget for the fiscal year 2025–26, totaling Rs 17.573 trillion. Presented by Finance Minister Muhammad Aurangzeb, the budget introduces several significant fiscal reforms, new taxation measures, and adjustments in key sectors.
New Taxes and Levies
Carbon Levy
| Item | Details |
| Tax Type | Carbon Levy |
| Rate | Rs 2.50 per litre |
Sales Tax on Solar Panels
| Item | Details |
| Tax Type | Fixed Sales Tax |
| Rate (Initial) | 10% |
| Revised Rate | 5% (after 50% reduction) |
Crackdown on Sales Tax Fraud
The government approved arrest in Sales tax fraud involving Rs 50 million or more. Issuing fake invoices, forging records, destroying evidence, or attempting to flee abroad will also land you behind bars.
Arrests must be approved by an FBR committee; detainees to be presented before a magistrate within 24 hours.
Customs Act
Introduction of a cargo monitoring system for import, export, and transit goods. Up to Rs 1 million fine and six months’ imprisonment for tampering with tracking devices. A new fund established using proceeds from the auction of smuggled goods.
Social Protection
A 20% rise in the Benazir Income Support Programme (BISP) budget — the largest-ever allocation — as demanded by PPP. Additional grants, though opposition alleges unfair distribution.
Lawmaker Compensation Reform
Power to determine MPs’ and ministers’ salaries shifted from the secretariat to a parliamentary House Committee. Federal ministers’ salaries now matched with those of provincial lawmakers. Salaries and Allowances Act of 1975 amended to reflect these changes.
Political Support and Opposition
Full support declared by PPP Chairman Bilawal Bhutto Zardari after inclusion of the party’s key proposals. PTI and other opposition members objected to increased taxation, lack of an energy policy, and FBR’s discretionary powers.
Budget 2025-26 shows government’s intent to broaden the tax base, enforce compliance, and increase social sector spending — while drawing mixed reactions from political parties and the public alike.
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