The government has made a major change in how tax policy is set in Pakistan. From now on, the Finance Division, not the Federal Board of Revenue (FBR), will be responsible for all tax policy decisions.
The next federal budget will be prepared by the new Tax Policy Office within the Finance Division, marking a clear separation between tax policy-making and tax collection.
This shift was announced during a meeting of the Senate Standing Committee on Finance, chaired by Senator Saleem Mandviwalla. Finance Minister Muhammad Aurangzeb explained that the Prime Minister is personally monitoring the FBR’s transformation, with regular reports to ensure accountability.
The new Tax Policy Office is almost fully staffed, and an advisory board, including members of Parliament and the private sector, will soon be formed to guide future decisions.
The committee also addressed other major fiscal concerns, including the FBR’s handling of a presidential order. Attorney General Mansoor Usman Awan attended the session, where complaints were raised that the FBR had challenged a presidential directive in the Sindh High Court instead of following it.
Lawyers for affected citizens argued that the FBR was legally required to implement the President’s instructions and had ignored clear guidance from both the Prime Minister’s Office and the Ministry of Law. The Attorney General was asked to help resolve the dispute.
On the economic front, Minister Aurangzeb highlighted positive developments, such as Pakistan’s successful Eurobond repayment—a sign of improved financial discipline. He also mentioned ongoing talks with China for a $250 million Panda Bond issuance by the end of November, as part of a larger billion-dollar investment plan.
Committee members welcomed the updates but stressed the importance of government bodies, including the FBR, following presidential and ombudsman orders to ensure good governance and accountability.
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Meaning finance will try to create more taxes on the struggling creating more Tax gap.
Alienating the country further. The people are tired of excessive taxation.
Nothing is affordable. Tell the richest to pay their taxes. Finance division only protects the richest
This is a good step. Having the FBR no longer in charge of tax policy removes a lot of conflicts of interests, especially given the FBR’s reputation these days. There is no reason why separating policy from collection and administration would lead to an increase in taxes by itself. We really need to educate ourselves about governance before making baseless claims.
Tax slab for rental income is very high as it goes to 45% of your income and then pay 10% surcharge on your total tax collection
Very high please reconsider the rates or we might have to sell the property
Our tax is directly deducted by the tanent no under paying