A new tax regime enforced across Pakistan’s Malakand Division from July 1 has triggered widespread opposition from traders, lawyers, civil society representatives, and local elders, who demand its immediate suspension until the Supreme Court delivers a verdict on the matter. Despite public protests and sustained opposition, the taxes have taken effect, prompting renewed calls on the federal and Khyber Pakhtunkhwa governments to withdraw or defer the measure.
Constitutional and Legal Concerns Raised
Representatives of traders’ associations, the legal fraternity, and civil society questioned the government’s decision to implement the taxes while the matter remains pending before the Supreme Court. They argued that enforcing the regime before the apex court delivers its verdict raises serious constitutional and legal concerns. The stakeholders contended that the taxation of Malakand Division infringes constitutional protections historically available to the region, referring to Article 247 and the legal framework that previously governed the former Provincially Administered Tribal Areas (PATA). They maintained that no decision affecting the constitutional or administrative status of the region should be taken without consulting its people and key stakeholders.
Criticism of Elected Representatives
The implementation of the tax regime also drew criticism of elected representatives from the division’s nine districts in the National Assembly and the Khyber Pakhtunkhwa Assembly. Residents questioned their failure to prevent the move despite enjoying the mandate of millions of voters, accusing them of prioritising political interests over the constitutional and economic concerns of their constituents.
Historical Commitments and Economic Vulnerability
Community leaders said there was broad consensus among traders, lawyers, social activists, and local elders that, when the former State of Swat acceded to Pakistan, an understanding had been reached under which the region would continue to enjoy tax-free status. They further claimed that residents had also been assured the region would receive development comparable to the rest of the country, including improved infrastructure, road networks, healthcare, education, tourism, and employment opportunities. According to local elders, many residents of the former princely state initially opposed the merger with Pakistan and staged demonstrations before being assured that accession would bring peace, prosperity, and development on a par with other parts of the country. They said these assurances persuaded the people to accept the merger, while the region’s special constitutional position continued until the promulgation of the Constitution of 1973.
The stakeholders argued that the imposition of taxes from July 1, 2026, contradicts those historical commitments and said the people of Malakand Division would not accept any measure altering the region’s special status without public consultation and constitutional safeguards. They also highlighted the division’s economic vulnerability, noting that it has endured decades of natural disasters, including major earthquakes, recurring floods and heavy snowfall, as well as prolonged militancy. According to the representatives, these factors have inflicted severe human and financial losses, leaving trade and commercial activity fragile. They argued that the local economy was ill-equipped to absorb additional taxation and urged the government to take the region’s economic circumstances into account before introducing new fiscal measures.
Alleged Procedural Irregularities
The stakeholders also criticised the inclusion of the term “PATA” during legislation relating to the merger of the former Federally Administered Tribal Areas (FATA) with Khyber Pakhtunkhwa, alleging that it had been inserted at a late stage and had adversely affected the region’s historical constitutional position. They further argued that any proposal to alter the fiscal or constitutional status of Malakand Division should have been preceded by meaningful consultations with elected representatives, local stakeholders, and the wider public. They maintained that no such consultative process had taken place.
Demand for Supreme Court Decision
Questioning the legal basis for implementing the tax regime while the matter remains sub judice before the Supreme Court, the representatives urged the authorities to review the decision if it is found to conflict with constitutional or judicial requirements. Reiterating their demand, the stakeholders called on the federal and provincial governments to suspend or withdraw the tax notification until the Supreme Court delivers its final judgment, arguing that such a move would provide much-needed relief to residents and help avert further economic hardship across Malakand Division.
