Pakistan Told to Release Tax Simplification Plan by Next Year

The International Monetary Fund (IMF) has urged Pakistan to implement a series of critical reforms before the announcement of the next fiscal year’s budget, with a particular focus on simplifying the country’s tax system. According to documents, the IMF has called for Pakistan to release a comprehensive tax simplification strategy by May 2026. The Fund has also recommended reducing tax exemptions across various sectors, as well as scaling back special tax regimes, heavy withholding, and advance taxes. The IMF’s recommendations include limiting the Federal Board of Revenue’s (FBR) authority to make rules, issuing annual progress reports on the implementation of FBR’s recommendations, and improving the FBR’s organizational structure. The Fund has also advised reducing the powers of FBR’s field offices and increasing accountability in FBR operations. Additionally, the IMF has called for audit findings related to the Petroleum Levy to be published within one year, as part of efforts to enhance transparency and oversight in Pakistan’s fiscal management.