The Federal Constitutional Court has dismissed more than 395 review petitions challenging its ruling upholding the super tax, leaving the levy in place. A three-judge bench led by Chief Justice Aminuddin Khan issued detailed reasons on 12 November, after reserving the petitions on 2 November.

The petitions sought reconsideration of the 27 January 2026 judgement upholding the super tax under Sections 4B and 4C of the Income Tax Ordinance, 2001. The court said review is confined to correcting manifest mistakes, and cannot be used as a disguised appeal.

What the court decided

The court reaffirmed that Parliament may impose the tax, holding that it falls within Entry 47 of the Federal Legislative List and can be imposed through a Finance Act as a Money Bill. It rejected equality challenges under Article 25, finding income-based classifications have a rational link to the legislation's aim. Section 4B, introduced in 2015, taxes individuals earning more than Rs500 million, originally to fund rehabilitation of displaced persons. Section 4C, introduced in 2022, extended the levy to individuals and entities earning more than Rs150 million from tax year 2022. The court held retrospective taxation is permissible but must not disturb past and closed transactions.

Limits kept for banks and energy firms

For banking companies, Section 4C will apply from tax year 2023 at the rates revised under the Finance Act, 2023. For exploration and production companies, the super tax applies only so far as total taxation stays within the limits set under the Fifth Schedule and the applicable petroleum concession agreements. Exemptions for benevolent and provident funds were upheld. After the 27th Amendment, the court said, Supreme Court decisions are persuasive but not binding on it. Petitioners included JS Bank, Engro, Pakistan Petroleum and Meezan Bank.

Sources: Pak News Point, WE News English