FBR collects PKR 1.9 trillion through electricity bills over four fiscal years, Senate panel told

The Federal Board of Revenue (FBR) collected PKR 1.866 trillion in sales tax and income tax through electricity bills over the past four fiscal years, including PKR 476.1 billion in FY2025-26, according to a briefing presented to the Senate Standing Committee on Finance and Revenue.

 

FBR Chairman Rashid Langrial dismissed reports claiming the tax authority collected PKR 620 billion through electricity bills in the last fiscal year, calling such figures inaccurate. He noted that the latest collection comprised PKR 351.8 billion in sales tax and PKR 124.4 billion in withholding income tax recovered through electricity distribution companies (DISCOs).

 

According to the FBR, tax collections through electricity bills stood at PKR 312.8 billion in FY2022-23, PKR 515.5 billion in FY2023-24, PKR 562 billion in FY2024-25 and PKR 476.1 billion in FY2025-26.

 

Langrial said electricity remains one of the most concessionary sectors in the economy and warned that tax liabilities could increase if those concessions were rationalised. He also stated that sales tax on electricity is a standard international practice and noted that around PKR 400–500 billion in adjustable withholding tax goes unclaimed each year because eligible taxpayers do not file tax returns to seek refunds.

 

During the meeting, senators raised concerns over rising electricity costs and the impact of multiple taxes on consumers, with lawmakers arguing that taxes have significantly increased electricity bills.

 

The committee also reviewed banking issues, including account closures involving politically exposed persons (PEPs), SMS alert charges and domestic card transactions. State Bank of Pakistan (SBP) Governor Jameel Ahmad assured the committee that uniform standard operating procedures would be developed for banks, clarified that SMS alerts are optional, and confirmed that domestic Visa card transactions would continue to be settled in Pakistani rupees rather than US dollars.

 

Separately, the committee discussed proposed amendments to the Foreign Investment (Promotion and Protection) Act, 2022. The Finance Division opposed extending the Act's incentives to all projects worth at least USD 500 million, citing fiscal constraints, existing international commitments and the significant tax concessions available under the current framework.