“Power to levy taxes is a sine qua non for a State. In fact, it is an attribute of sovereignty of a State… it must be exercised strictly in accordance with the Constitution…. Subordinate legislation cannot go beyond the scope of ‘taxes on income’ used in the Constitution. If we were to construe Entry 52 of the Legislative List keeping in view the above meanings of the expression ‘in lieu of’, it becomes evident that the Legislature has the option, instead of invoking Entry 47 for imposing taxes on income, to impose the same under Entry 52 on the basis of capacity to earn in lieu of Entry 47, but it cannot adopt both the methods in respect of one particular tax”—Supreme Court in Messrs Elahi Cotton Mills & others v Federation of Pakistan & others [PLD 1997 Supreme Court 582].

In its short order of January 27, 2026, as mentioned in last week’s column, the Federal Constitutional Court (FCC) of Pakistan, in an attempt to validate the imposition of super tax under the Income Tax Ordinance, 2002, has not only unsettled well-established constitutional jurisprudence—extending a free hand to Parliament to keep Entry 47 of Part I of the Federal Legislative List alive indefinitely merely by invoking different labels—but has also rendered the doctrine of exhaustion meaningless.

Para 9(vii) of the FCC’s short order seeks to justify the super tax as an independent charge while simultaneously asserting that section 4 of the Income Tax Ordinance, 2001, already exhausts the field of “taxes on income”. This single finding collapses under the weight of its own internal contradiction.

In constitutional logic, one cannot exhaust a legislative entry and yet continue to derive further taxing power from the very same entry by merely altering nomenclature. You cannot have the cake and eat it too.

Super Tax, Senate Bypass, And The FCC’s Constitutional Misreading

The gravest error in the FCC’s order lies in its implicit acceptance that the term income, as envisaged under the Constitution of the Islamic Republic of Pakistan (“the Constitution”), itself can be varied through sub-legislative sleight of hand. This proposition strikes at the heart of tax jurisprudence.

Income is not whatever Parliament declares it to be for revenue purposes. It is a juridical and economic concept with settled contours: real accrual, real receipt, and real capacity to pay, and legitimate legal fiction for income, place, person, and time under the doctrine of nexus, but not in violation of any provision of the Constitution.

Courts are meant to act as guardians of constitutional boundaries, not facilitators of fiscal overreach. The short order, particularly its Paras 9(v) and 9(vii), fails this test by conflating form with substance, rate with base, and power with convenience.

Para 9(v) mistakes definitional breadth for constitutional legitimacy. Income may be defined broadly, but not beyond taxing power. Once income from all sources is charged under section 4 of the Income Tax Ordinance, 2001, the Constitution does not permit Parliament to circle back and tax it again under a different label, a different section, or a different purpose.

The short order’s reasoning in Paras 9(v) and 9(vii), read together with the declaration that super tax under sections 4B and 4C constitutes independent charges, reveals a deep internal incoherence that threatens to destabilise the constitutional architecture of taxation in Pakistan. What emerges is not a coherent interpretation of legislative competence, but a jurisprudence that treats constitutional limits as malleable, legislative entries as interchangeable, and the concept of income as infinitely adjustable to suit fiscal convenience.

Under established tax jurisprudence, surtax, super tax, surcharge (or any other nomenclature) is........

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