Key Takeaways
- The Federal Board of Revenue collected Rs1.866 trillion in sales tax and income tax through electricity bills over the last four fiscal years.
- Rs476.1 billion was collected in the 2025-26 fiscal year, with a breakdown of Rs351.8 billion in sales tax and Rs124.4 billion in income tax.
- Senator Kamil Ali Agha criticized multiple taxes on electricity bills as coercive.
The Federal Board of Revenue (FBR) has reported that it collected a cumulative total of Rs1.866 trillion through sales tax and income tax levied on electricity bills over the last four fiscal years, according to an official briefing presented before the Senate Standing Committee on Finance and Revenue.
In the 2025-26 fiscal year alone, the FBR collected Rs476.1 billion, with a detailed breakdown of Rs351.8 billion in sales tax and Rs124.4 billion in income tax withheld through electricity distribution companies (DISCOs).
The FBR Chairman, Rashid Langrial, warned that if taxes on the power sector were rationalized, they would likely increase due to the sector's significant contribution to GDP.
During the briefing, Senator Kamil Ali Agha expressed concern over reports suggesting a Rs620 billion collection through electricity bills, describing them as 'not factual.' He also criticized multiple taxes imposed on electricity bills, which he said had pushed per-unit prices to Rs85 and made life difficult for consumers.
The FBR Chairman clarified that sales tax is levied on domestic consumer electricity bills, stating it is a common practice worldwide. He added that every year, between Rs400-500 billion in income tax withholding remains unclaimed but taxpayers can claim refunds by filing their returns.
Senator Agha also raised issues regarding difficulties faced by customers, particularly Politically Exposed Persons (PEPs), when dealing with commercial banks. MNA Muhammad Moin Amir Pirzada informed the Committee that his bank account had been closed in April 2026 despite repeated correspondence with the concerned bank and State Bank of Pakistan (SBP).
The FBR Chairman stated that while dedicated officers have been designated in banks, no uniform Standard Operating Procedures (SOPs) have been developed. He emphasized the need for a standardised annual data updating mechanism to prevent such incidents.
Governor State Bank acknowledged existing regulations governing PEP-related cases but noted the lack of uniform SOPs and the need for better implementation.
The FBR collected a total of Rs312.8 billion in fiscal year 2022-23, Rs515.5 billion in 2023-24, Rs562 billion in 2024-25, and Rs476.1 billion in 2025-26.
FBR official
He said that multiple taxes imposed on electricity bills had pushed the per-unit price to Rs85, while the burden of high electricity bills had made life extremely difficult for consumers.
Senator Kamil Ali Agha, Senator
