Pakistan, May 31 -- The federal government plans to end the sales tax exemption for former tribal areas in the upcoming 2025-26 budget. This move could help the government raise over Rs45 billion in revenue. The decision will also impact electricity supplies to the ex-FATA and PATA regions, ending years of tax relief provided after their merger with Khyber Pakhtunkhwa.

According to officials, an 18% sales tax will be applied to goods made in the region. The Federal Board of Revenue (FBR) may also add a withholding tax on imports. If income tax concessions are removed as well, revenue could increase even more. The FBR is currently finalising changes to tax laws based on court rulings.

Previously, the Finance Act had extended tax relief u...