FBR Excludes FTA, PTA Duty Concessions From Report

The Federal Board of Revenue (FBR) has excluded customs duty concessions provided under Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) from its Tax Expenditure Report 2026.

According to the FBR, these duty concessions stem from Pakistan’s legally binding international commitments made under trade agreements.

Unlike tax incentives introduced through domestic policy decisions, concessions granted under FTAs and PTAs cannot be revoked unilaterally without risking potential treaty obligations and international consequences.

The FBR stated that it adopted the same approach used for tax measures arising from international commitments under the income tax framework.

As a result, revenue forgone due to customs duty concessions under these trade agreements has not been treated or reported as tax expenditure in the Tax Expenditure Report 2026.