ACCA Pakistan proposes uniform tax rate, tech incentives in FY26 budget

The Association of Chartered Certified Accountants (ACCA) Pakistan has unveiled a series of tax reform proposals for the upcoming FY26 budget, aimed at simplifying the tax system, enhancing fairness, and boosting economic growth.

Key recommendations include harmonizing tax rates for salaried and non-salaried individuals, introducing a 35% marginal tax rate for income exceeding PKR 50 million, and ensuring equitable treatment for professionals and sportspersons.

The proposals also call for targeted tax relief in sectors such as IT, artificial intelligence-based research and development, green economy investments, and documented trade.

To improve tax administration, ACCA suggested establishing an independent Tax Law Simplification Commission, inspired by models like the UK’s Office of Tax Simplification and India’s Direct Tax Code initiative. The body would develop a 3–5 year tax policy roadmap to increase predictability and attract investment.

The association also recommended a Taxpayer Engagement & Transparency Portal, modeled after Canada’s CRA and the UK’s HMRC public consultation mechanisms, to enhance taxpayer trust.

Additionally, ACCA pushed for expanding mandatory e-filing and point-of-sale integration, citing successful examples from Estonia’s e-Tax Board and India’s AI-driven tax audits.

In a bid to strengthen judicial neutrality, ACCA proposed appointing tax tribunal members through the Federal Public Service Commission (FPSC). To ensure accountability, it called for an Independent Tax Oversight Body, similar to the U.S. Treasury Inspector General for Tax Administration (TIGTA) and Australia’s Inspector-General of Taxation.

The proposals prioritize three urgent reforms: Tax Law Simplification, Policy Certainty, and Real Estate Valuation Reform. ACCA expressed its readiness to collaborate with public institutions, businesses, and civil society to foster a fiscally sustainable and investment-friendly environment.

“ACCA’s tax tenets stress simplicity, certainty, efficiency, and fairness. Our proposals reflect the voice of our members working across diverse sectors in Pakistan and are grounded in both international best practices and local realities,” said Assad Hameed Khan, Head of ACCA Pakistan.

Aucky Pratama, ACCA’s Executive Director for Asia Pacific, added, “ACCA’s budget proposal recognizes the urgent need for systemic reform and a vision for a self-reliant and prosperous economy. It sets out a clear, practical pathway for transforming Pakistan’s taxation system into one that not only raises revenue but actively enables economic opportunity and citizen trust.”