In a decisive move, the National Assembly Standing Committee on Finance has unanimously rejected the proposed 18% sales tax on imported solar panels, signaling strong opposition to anti-environmental measures within the Finance Bill 2025. The government also backtracked on its plan to increase sales tax on hybrid vehicles, retaining the existing 12.5% rate for cars up to 1800cc.
Chaired by PPP’s Syed Naveed Qamar, the committee argued that the proposed taxes would hurt both consumers and the environment. Qamar emphasized that no political party supported the tax on solar imports and warned that the National Assembly would veto it if reintroduced.
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The Federal Board of Revenue had projected Rs20 billion in revenue from the solar tax and Rs7 billion from the hybrid car tax hike. However, FBR Chairman Rashid Langrial admitted that the local solar panel industry’s share in the market was minimal, weakening the rationale for the import tax.
While Finance Minister Muhammad Aurangzeb stressed that subsidies had ended, Qamar countered by pointing to ongoing support for electric vehicles. The committee’s stance reflects growing political resistance to measures seen as regressive toward sustainable energy solutions.
