The FBR Chairman Signals Tough 2025-26 Budget for Pakistan, indicating that the upcoming fiscal year will be challenging, with no sales tax reductions or concessions, except for potential tax relief for the salaried class. This relief will depend on approval from the International Monetary Fund (IMF).
Rashid Mahmood Langrial, Chairman of the Federal Board of Revenue (FBR), made these remarks during a meeting of the Standing Committee on Finance and Revenue at Parliament House on Wednesday. He noted that the IMF mission will visit Pakistan in the second week of May 2025 to discuss budgetary proposals.
Finance Minister Muhammad Aurangzeb, attending remotely from Karachi, confirmed that the government is considering tax relief for salaried individuals in the next budget. The FBR has been working on significant tax measures to support the salaried class.
In response to a proposal from the dairy sector to reduce sales tax on milk from 18% to 5%, Langrial explained that such a reduction is not feasible due to the ongoing IMF program, which limits changes in sales tax rates. He also mentioned that the country is facing difficulties in revenue collection, as economic assumptions used to set tax targets for the 2024-25 fiscal year have been revised.
Langrial highlighted the creation of a tax policy unit at the Ministry of Finance. However, the 2025-26 Budget will continue to be reviewed by the FBR until the unit becomes fully operational.
During the meeting, the committee discussed several key legislative matters. One of them was the “Income Tax (Amendment) Bill, 2024,” which the committee recommended for approval by the National Assembly. The committee also considered the “Corporate Social Responsibility Bill, 2025,” a private member’s bill introduced by MNA Dr. Nafisa Shah, which received unanimous support from members.
Concerns were raised about Zarai Taraqiati Bank Limited (ZTBL), urging the bank to expand its loan base and introduce initiatives like credit cards for farmers. The committee also expressed concerns about the potential privatization of ZTBL and requested a detailed breakdown of its loan disbursements.
The meeting concluded with unanimous approval of the minutes from the previous session, with senior officials from the Ministry of Finance, FBR, and other relevant departments in attendance.
Stay updated with MediaBites, your trusted source for the latest insights on Pakistan’s upcoming tough budget and tax policies.
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