FBR Taxes Recreational Clubs Under Finance Act 2025

Islamabad, August 7, 2025, 02:32 PM PKT — The Federal Board of Revenue (FBR) has unveiled a major policy shift, excluding recreational clubs from the non-profit organization definition under the Finance Act 2025, as per official details, targeting their tax status. An amendment to Section 18 of the ordinance now extends taxability—previously applied to cooperative societies for income from sales of goods, immoveable property, or services to members—to recreational clubs engaged in similar transactions, with the FBR clarifying this applies to revenue-generating activities. A further amendment to Section 2, clause (36) excludes clubs with membership fees exceeding Rs1 million for new members from non-profit status.

This move aims to broaden the tax base, but web context on tax reforms shows past resistance, while posts found on X reflect concern and debate—some see fairness, others fear impact on clubs. Critically, the narrative of “tax equity” may mask implementation hurdles—web data hints at enforcement gaps, and X sentiment suggests distrust in consistent application, pointing to potential challenges.