KARACHI: The Pakistan Stock Brokers Association (PSBA) has presented a comprehensive set of tax proposals to the Ministry of Finance and the Federal Board of Revenue (FBR) for inclusion in the federal budget for the fiscal year 2025-26.

Aimed at boosting economic growth and strengthening the capital market, the proposals seek to enhance government revenues while encouraging investment in documented and productive sectors.

The Pakistan Stock Exchange (PSX) has recently witnessed a strong upward trend, fuelled by macroeconomic stability. To sustain this momentum, the PSBA urges policymakers to adopt measures that will solidify the stock market’s role in economic growth, tax generation and financial documentation. As one of the most documented sectors, capital markets play a crucial role in increasing taxpayer numbers, promoting savings and investment, and addressing wealth inequality.

Key recommendations include amendments to the Income Tax Ordinance, 2001, such as redefining the term ‘security’ under Section 37A, rationalising tax rates for listed companies, and addressing tax issues related to brokerage and commission under Section 233.

The PSBA also proposes the introduction of Investment Savings Accounts (ISA), resolution of Sindh Sales Tax jurisdiction conflicts through the Council of Common Interest, and long-term tax policy consistency. Other suggestions include revising tax on dividends under Section 5, modifying Section 153(k) of the Companies Act, and reconsidering the tax on bonus shares under Section 236(Z).

The PSBA emphasises that these reforms will create a favourable investment climate, improve tax collection and support national economic objectives. The association remains committed to collaborating with the government to ensure sustainable growth and development in Pakistan’s capital markets.