ISLAMABAD: The Federal Board of Revenue (FBR) has extended sales tax exemptions on the import or lease of aircraft and aircraft parts to all airline companies registered in Pakistan.
According to instructions issued by the FBR to its field formations, the exemption has been extended through the addition of Serial No. 181A to the relevant schedule.
The move provides tax relief to Pakistani airlines importing or leasing aircraft and related parts, potentially reducing the tax burden associated with fleet expansion and maintenance.
The FBR has also restored sales tax exemptions on the import of ships flying the Pakistani flag. The exemption, which had been withdrawn in 2021, has now been reinstated.
In addition, sales tax relief has been restored for the import of plant, machinery, and other capital assets used for shipbuilding.
Revised Federal Excise Duty on Air Tickets
The tax authority has also rationalized federal excise duty on club, business, and first-class air tickets.
Under the revised structure, the duty has been set at:
Destination Federal Excise Duty
North America Rs. 50,000
Middle East Rs. 25,000
Europe Rs. 40,000
Far East & Australia Rs. 40,000
The FBR explained that the changes were introduced to address cases where federal excise duty on premium air tickets could exceed the actual ticket price.
The latest measures provide tax relief for the aviation and shipbuilding sectors while revising the duty structure for premium air travel.
