FBR Approves Rs126bn in Refunds and Rebates for Businesses
FBR Chairman Rashid Mahmood Langrial meets FPCCI officials to discuss refunds, rebates and business concerns in Karachi.
The Federal Board of Revenue (FBR) has approved the payment of around Rs83 billion in pending income tax refunds and Rs43 billion in rebates over the next two to three months.
FBR Chairman Rashid Mahmood Langrial announced the measures during a meeting with office-bearers of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) in Karachi.
The meeting followed Prime Minister Shehbaz Sharif’s directive to hold monthly discussions with Karachi’s business community during the first week of each month. Taxation, customs, imports, exports and refunds remained key areas of discussion.
Rs83bn Refunds to Be Paid
FPCCI Senior Vice President Saquib Fayyaz Magoon briefed reporters on the meeting’s major decisions. He said around Rs83 billion in old income tax refunds remain pending.
FBR had earlier decided to clear deferred refunds within one to two months. However, FPCCI pressed the issue of older claims during the meeting.
In response, Chairman Langrial directed officials to release the pending refunds within two to three months.
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The meeting also covered refunds linked to Refund Payment Orders (RPOs). FBR agreed to immediately process income tax refunds for which RPOs have been issued since August 2026.
Rs43bn Rebates Also Set for Payment
Another major decision concerns pending rebates. According to Magoon, outstanding rebates currently stand at around Rs43 billion.
FBR has agreed to pay these rebates over the next two to three months. The decision could provide additional cash-flow relief to businesses.
FBR Eases Export Facilitation Concerns
The meeting also addressed concerns surrounding the Export Facilitation Scheme (EFS). Preventing the misuse of grey fabric under the scheme emerged as an important issue.
Exporters had also raised concerns about higher valuation rulings on raw materials imported through the EFS. Magoon clarified that the scheme’s 10% value-addition requirement applies to exported finished goods.
Previously, authorities could hold exports if the required value addition did not appear in the finished products. Under the agreed approach, officials will allow the relevant Goods Declaration (GD) to proceed.
Authorities will review the value addition, total cost and valuation details afterward. This process will determine whether exporters have met the prescribed requirements.
Pre-Arrival GD Filing Gets Attention
FPCCI also raised the issue of pre-arrival Goods Declaration filing. Importers often delay the process because banks require Funds Identification (FI) before payment arrangements.
In principle, FBR agreed to check the FI requirement at the out-charge stage. The move could encourage more importers to file GDs before shipments arrive.
Necessary changes to State Bank regulations will also be considered, according to the meeting.
Classification Disputes Cut to 90 Days
FPCCI requested a shorter timeline for resolving classification disputes. The existing period stood at 120 days.
Chairman Langrial immediately ordered a reduction to 90 days. The meeting also discussed anomalies involving tax exemptions under the Fifth Schedule.
FBR agreed to resolve those issues in consultation with the relevant departments.
Faster Sales Tax Registration
Businesses also received relief on sales tax registration. Under the agreed mechanism, authorities will complete low-risk registrations within one week.
For high-risk cases, officials will seek verification from relevant trade associations. They will then expedite the registration process where appropriate.
FBR Reviews Small Traders Scheme
The meeting also examined the slow enrollment of small traders under a government registration scheme.
The government had set a target of one million traders. However, only around 3,800 traders had enrolled so far, with the number estimated at about 5,000.
FPCCI offered to support awareness efforts among small traders. Business leaders and relevant associations will also meet to identify barriers that have slowed registration.
Magoon said FPCCI would help improve coordination among FPCCI, FBR and small traders. He also pledged support for an awareness campaign aimed at making the scheme more successful.
