The federal cabinet has deferred approval of the new net metering policy and halted the imposition of additional taxes on solar energy users.
The decision was taken to expand consultations and seek further input from all stakeholders before presenting final recommendations to the cabinet.
The cabinet meeting, chaired by Prime Minister Shehbaz Sharif at the Prime Minister’s House, was attended by cabinet members and senior officials. During the meeting, the cabinet opposed the proposed additional tax on consumers using solar energy and directed the Minister for Energy to review the net metering policy. Sources revealed that the new policy initially proposed purchasing electricity from consumers at Rs 10 per unit, along with additional tax provisions, which sparked opposition from within the government itself.
In another major decision, the cabinet approved a reduction in electricity prices, utilizing savings from lower petroleum product costs. Additionally, the cabinet gave the Central Power Purchasing Agency (CPPA) the green light to sign revised agreements with bagasse-based power plants under updated conditions.
The meeting also saw the approval of several key legislative measures. The cabinet granted in-principle approval to the Whistleblower Protection and Vigilance Commission Act 2025, recommended by the Ministry of Law and Justice. Furthermore, amendments to income tax, sales tax on services, and federal excise duties within Islamabad’s jurisdiction were approved as part of the Resource Mobilization and Utilization Reform Program. The Income Tax (Second Amendment) Bill 2025, restoring tax rebates for full-time teachers and researchers, was also passed.
The cabinet endorsed the decisions made by the Privatization Committee on March 11, 2025, and the Economic Coordination Committee (ECC) on March 13 and March 21, 2025.
Addressing the meeting, Prime Minister Shehbaz Sharif expressed satisfaction over Pakistan’s Extended Fund Facility (EFF) review agreement with the International Monetary Fund (IMF), securing $1.3 billion for climate resilience efforts. He emphasized that the successful $7 billion IMF deal review reflected the global lender’s confidence in Pakistan’s economy.
The Prime Minister noted that the IMF appreciated Pakistan’s economic stability, reduced inflation levels, and fiscal improvements, acknowledging the government’s commitment to economic reforms and governance enhancement. He praised Finance Minister Muhammad Aurangzeb and the economic team for their efforts in securing these agreements, stating that they would help stabilize the economy and pave the way for long-term growth.
Shehbaz Sharif reaffirmed the government’s commitment to tax reforms, energy sector efficiency, and private sector growth, emphasizing that positive economic indicators over the past year reflect effective policymaking. He urged national unity for Pakistan’s prosperity, highlighting the blessings of Ramadan as an opportunity to work together for the country's development.
