In a move poised to reshape Pakistan’s industrial landscape, the federal government is preparing to slash the super tax rate for the manufacturing sector under its upcoming industrial policy—pending approval from the International Monetary Fund (IMF).
🔻 Phased Reduction Strategy
Sources reveal that the super tax will be gradually reduced to 5% over the next four years, with a complete abolition in the fifth year, contingent on maintaining a surplus in the primary balance.
📊 Threshold Revisions to Ease Burden
The draft policy proposes raising the minimum threshold for super tax from Rs. 200 million to Rs. 500 million, while the 10% super tax bracket would apply only to entities earning above Rs. 1.5 billion, up from the current Rs. 500 million. This aims to shield smaller manufacturers and shift the fiscal load to larger corporations.
🏭 Revival & Restructuring Measures
To support struggling industrial units, the policy outlines:
•     A bankruptcy framework for business restructuring
•     Easier credit facilities to stimulate production
•     Tax rationalization to improve sectoral competitiveness
🌍 Boosting Investment & Exports
The policy also includes provisions to:
•     Protect domestic and foreign investments
•     Enhance global competitiveness of Pakistani manufacturers
•     Encourage export-led growth through strategic incentives
🗓️ Cabinet Approval Expected Soon
The draft is expected to be tabled before the federal cabinet later this month, with final implementation hinging on IMF’s green light.