Government Set to Unveil Rs. 1.5 Trillion Mini-Budget to Address Financial Woes

Pakistan’s government is working on a mini-budget worth Rs. 1 trillion, set to take effect on November 1. This move is aimed at addressing the country’s financial challenges. According to sources from the Federal Board of Revenue (FBR), Pakistan is expected to face a shortfall of Rs. 150 billion in September, which may lead to the removal of sales tax exemptions.

The current month’s revenue target of Rs. 110 billion is unlikely to be met, making this mini-budget a necessity. Key factors driving this decision include:

Shortfall Expectation:

A significant revenue gap of Rs. 150 billion is anticipated in September, raising concerns about meeting revenue targets.

Sales Tax Exemption Removal:

The government may withdraw sales tax exemptions to address the shortfall.

Revenue Target:

The FBR has set an ambitious target of Rs. 11,174 billion for the 2024-25 financial year, representing a 20.8% increase from the previous year.

Additional Measures:

Proposals to increase withholding tax are on the table to achieve tax targets in the next financial year.

Despite the FBR’s efforts to boost revenue collection, with a 29.1% growth in net revenue during the previous fiscal year , additional measures are needed to address the current financial situation. The government aims to strike a balance between economic growth and fiscal stability.