KP Cabinet approves tax exemptions for merged districts, Malakand

The Khyber Pakhtunkhwa government has approved a package of measures aimed at providing tax relief to businesses and industries operating in the province’s merged tribal districts and Malakand Division

PESHAWAR: The Khyber Pakhtunkhwa government has approved a package of measures aimed at providing tax relief to businesses and industries operating in the province’s merged tribal districts and Malakand Division, while also expanding welfare and education initiatives.

According to Khyber Pakhtunkhwa Information Minister Shafiullah Jan, the provincial cabinet has endorsed exemptions from certain provincial taxes for service providers and industries operating in areas previously covered by the Federally Administered Tribal Areas (FATA), Provincially Administered Tribal Areas (PATA) and Malakand Division.

Under the decision, service providers operating in the former FATA, PATA and Malakand areas will be exempted from provincial sales tax on services. Industries established in these regions will also receive relief from withholding sales tax.

The government said the tax measures were intended to encourage investment, facilitate businesses and support economic activity in areas that have historically faced developmental and infrastructure challenges.

Ehsaas Nawaz funding increased

The cabinet also approved a significant increase in the financial allocation for the Ehsaas Nawaz programme. According to the information minister, the programme’s funding has been raised from Rs3 billion to Rs5 billion.

The increase is expected to provide additional financial support under the government’s welfare initiatives and expand the programme’s reach among deserving segments of the population.

Ashra Rahmat Lil-Aalameen programme approved

The provincial cabinet also approved arrangements for observing Ashra Rahmat Lil-Aalameen (PBUH) across Khyber Pakhtunkhwa.

The celebrations will formally begin from the first day of Rabi-ul-Awwal, with the cabinet approving a schedule for programmes to be organised across the province. The initiative is expected to include a range of activities aimed at highlighting the teachings, life and message of the Holy Prophet Muhammad (PBUH).

Education sector measures

Several decisions concerning education were also approved during the cabinet meeting.

The provincial government sanctioned funds for schools and colleges in various districts to address educational requirements and improve facilities. The cabinet also approved a system for providing textbooks according to the semester system up to Grade 5.

In another major education-related decision, the cabinet approved the provision of 100 percent free textbooks for students from Grade 9 to Grade 12.

The measures are aimed at reducing the financial burden on students and their families while improving access to educational resources, particularly for students enrolled in government institutions.

Public-private partnership legislation

The cabinet further approved the Khyber Pakhtunkhwa Public Private Partnership Authority Bill 2026 for enactment.

The proposed legislation is intended to establish a formal framework for public-private partnerships in the province and facilitate greater participation of the private sector in development projects.

The government believes stronger public-private cooperation can help mobilise investment, improve service delivery and accelerate infrastructure development across Khyber Pakhtunkhwa.