Islamabad: The Parliament has approved the Finance Act 2026 following amendments that introduce a series of tax adjustments aimed at fostering equitable growth in alignment with International Monetary Fund (IMF) recommendations. The bill, which received the necessary approval from the National Assembly, includes significant changes such as the abolition of the super tax for large exporters and adjustments to excise duties on certain vehicles. These measures are designed to stimulate specific sectors of the economy while addressing broader fiscal goals.

According to JS Global, one of the notable changes in the amended Finance Bill is the elimination of the super tax for companies where export proceeds exceed 80% of total turnover, providing a substantial incentive for large textile exporters, including firms like Interloop Ltd. This move is expected to boost the competitiveness of these exporters on the global stage. However, companies that are taxable under the Final Tax Regime, such as those in the IT sector or loss-making entities paying minimum turnover tax, will not be affected by this change.

The legislation also addresses the automotive sector by increasing excise duties on electric vehicles priced above $75,000 and internal combustion engine vehicles with an engine capacity greater than 2000cc. This adjustment aims to protect the local automotive industry from foreign competition. Additionally, the period for eligibility for a reduced tax rate on life insurance and family takaful payouts has been shortened from seven to four years, which could impact policyholders.

From a capital markets perspective, the National Assembly's approval of a 2% cut in the super tax for all corporates with profits above Rs500 million, excluding those in the fertilizer, exploration and production, and banking sectors, is seen as a positive development. The abolition of the super tax for large exporters is also expected to be well-received by investors, potentially boosting market confidence.