The federal government is planning to increase its tax collection target for the next financial year by Rs. 2 trillion. This would bring the total target to Rs. 14.3 trillion, which is 16% more than the current revised target of Rs. 12.3 trillion. The new goal would also make up about 11% of Pakistan’s expected GDP for the upcoming year.
To meet this target, the government may introduce around Rs. 500 billion in new taxes. This would be on top of the Rs. 1.3 trillion in taxes that have already been collected this year.
These possible changes will be reviewed by IMF during its mid-May visit. The final decisions will likely be part of the federal budget, which is expected to be presented in early June.
Meanwhile, business groups and trade associations are asking the government to provide some relief. They are calling for tax reforms that would support low-income people and reduce the corporate tax rate to help businesses grow. However, experts say that many of these suggestions may not be possible right now because of Pakistan’s tough financial situation and promises made to global lenders like the IMF.
The government is under pressure to increase revenue without hurting the economy. Balancing new tax measures with public and business support will be a challenge. If done carefully, the new tax plan could help the country manage its debt and meet international financial goals.
For now, all eyes are on the upcoming budget and the IMF’s visit, which will play a key role in shaping Pakistan’s financial future. More details are expected to come out as the budget date gets closer.
