The Council of Islamic Ideology (CII) ruled on September 24, 2025, that withholding tax on bank withdrawals and transfers is prohibited under Sharia law. At its 243rd meeting, chaired by Dr. Raghib Hussain Naeemi, the council called the tax “injustice.”
The Federal Board of Revenue (FBR) describes withholding tax as an advance payment according to the Income Tax Ordinance, 2001, and the Sales Tax Act, 1990. Sources indicate that FBR intends to contest the CII’s ruling in the Supreme Court.
The CII addressed human milk banks. They can be set up with conditions, but laws must be established first to prevent misuse. Pakistan’s first milk bank at Sindh Institute of Child Health and Neonatology (SICHN) opened in June 2024 but closed after a fatwa. SICHN awaits further CII guidance.
Read: The Council of Islamic Ideology Proposes Penalties for Instant Triple Talaq
The CII opposed the Senate’s September 13 amendment to diyat (blood money) laws, raising the minimum from 30,663 to 45,000 grams of silver. They said gold, silver, and camels should be included in the law.
The council advised against pig-derived insulin for diabetic patients. Halal insulin is widely available, they noted, urging its use.
The rulings of the CII have a significant impact on Pakistan’s laws and culture. The recent tax decision may impact banking and revenue generation. Additionally, the establishment of milk banks and the implementation of diyat laws affect health and justice. These aspects reflect the role of Sharia in policy formation.
