Jazz has settled its tax dispute with Pakistan’s federal tax authorities through the Alternate Dispute Resolution Committee (ADRC). An official document revealed that the settlement, finalized on June 27, 2025, amounted to $158 million. This development came after a landmark decision by a division bench of the Islamabad High Court (IHC). The court ruled in favor of the Federal Board of Revenue (FBR) in a case involving a high-value intra-group transaction. As a result of the ruling, Jazz is now liable to pay approximately Rs22 billion ($78 million) in taxes.
The amount is linked to the gain from transferring its tower assets in an internal corporate restructuring. Earlier, on June 13, national media reported that Justice Babar Sattar had led the IHC bench delivering the decision. The verdict confirmed FBR’s authority to assess tax liability on intra-group transactions involving significant asset transfers.
Jazz 2018 Case
The case centers on a 2018 asset reorganization where Jazz transferred its nationwide tower infrastructure to a subsidiary. The transaction, valued at Rs98.5 billion ($940 million), resulted in an accounting gain of Rs75.9 billion. This follows a landmark judgment from the Islamabad High Court (IHC), where a division bench led by Justice Babar Sattar ruled in favor of the Federal Board of Revenue (FBR). The court confirmed that Jazz must pay approximately Rs 22 billion (US$78 million) in taxes.
Jazz transferred its entire nationwide tower infrastructure to a wholly owned subsidiary. The asset disposal was recorded with a Rs 75.9 billion accounting gain, based on a transaction valued at Rs 98.5 billion. Jazz had argued the deal was tax-exempt under Section 97(1) of the Income Tax Ordinance, which covers intra-group transfers.
However, the court found the asset transfer violated Section 97 requirements because it was conducted at fair market value and created actual economic gain, prompting taxation. It also upheld the commissioner’s right to consider accounting income when determining tax liability.