FBR Finalizes Tax-exemption Mechanism For Gilgit-Baltistan

Chairman Federal Board of Revenue (FBR) Rashid Mahmood Langrial on Wednesday said that a transparent mechanism has been finalized to exempt goods destined for Gilgit-Baltistan (GB) from sales tax, advance income tax, and federal excise duty, ensuring relief for the people of the region

ISLAMABAD, (UrduPoint / Pakistan Point News - 24th Sep, 2025) Chairman Federal board of Revenue (FBR) Rashid Mahmood Langrial on Wednesday said that a transparent mechanism has been finalized to exempt goods destined for Gilgit-Baltistan (GB) from sales tax, advance income tax, and federal excise duty, ensuring relief for the people of the region.

Talking to the media, he explained that earlier there was no administrative system to determine whether goods were consumed within GB or traded outside, which created friction at the borders. “Now, under the new framework, all goods meant for GB will be free from consumption-related taxes, while only customs and regulatory duties will continue to apply,” he said.

Rashid Mahmood said that the system was developed after extensive consultations with stakeholders and finalized in coordination with the Model Customs office. This neat and clean mechanism removes ambiguities and ensures that GB’s long-standing demand for tax relief is addressed.

He underlined that the new arrangement would end disputes, provide clarity to traders, and strengthen the federal government’s commitment to the welfare of the people of Gilgit-Baltistan.

It is pertinent to mention here that the federal government, GB government, and representatives of the local traders signed an agreement the previous day to ensure smooth operations of the Silk Route Dry Port at Sost for promoting regional trade and economic development.

The agreement was signed amongst the Federal Government of Pakistan, represented by the Federal Minister for Power Division and Chairman Federal Board of Revenue (FBR), the GB Government, and the authorised representatives of the local traders’ Supreme Council.

According to the document, the parties resolved to work jointly for uninterrupted functioning of the Sost Dry Port, with a focus on enhancing regional connectivity and facilitating cross-border commerce. The pact also reflects the consensus to address the issues raised by the traders regarding the implementation of Customs laws on consignments imported prior to February 28, 2025.

The agreement aims at creating a robust framework for cooperation between the federal government, GB government and the trading community to streamline port operations, reduce bottlenecks, and accelerate economic activity in the region.