Govt to Make Pakistanis Pay Rs. 2 Trillion More Tax Next Fiscal Year

The federal government is preparing to raise next fiscal year’s tax collection target by Rs. 2 trillion to Rs. 14.3 trillion, up 16 percent from the revised Rs. 12.3 trillion goal for the current year and representing 11 percent of the projected GDP for FY26. The government may introduce at least Rs. 500 billion in new tax measures. This is in addition to Rs. 1.3 trillion already imposed this year on salaried individuals, reported Express Tribune. The Rs. 14.3 trillion figure exceeds the FBR’s internal projection and is subject to approval from the International Monetary Fund (IMF) during its budget review visit starting May 14. The Finance Minister is expected to present the budget on June 2 or 3. The government had promised to respond to business budget proposals by the end of April, but has not done so. The Overseas Investors Chamber of Commerce and Industry (OICCI) has urged the withdrawal of Rs. 5,000 notes to curb the cash economy, the exemption of low-income earners, and tax relief for compliant taxpayers. It also seeks a gradual cut in corporate tax to 25 percent, a reduction of super tax from 10 percent to 6 percent, and the restoration of zero-rating for export-linked sales. Most OICCI demands, like reduced taxes on milk, juices, and dividends, face resistance due to IMF conditions. The government has already raised the petroleum levy by Rs. 18 to Rs. 78 per liter to help improve tax revenue statistics but any big improvement looks unlikely.