FBR May Seek IMF Approval to Cut FY26 Tax Target by Up to PKR 100 Billion

Islamabad: The Federal Board of Revenue (FBR) is preparing to seek approval from the International Monetary Fund (IMF) to reduce Pakistan’s tax collection target for fiscal year 2025–26 by up to PKR 100 billion, officials said. The minimum proposed adjustment is expected to be around PKR 50 billion.

Sources said working papers for the upcoming economic review are nearing completion, and the proposal has been discussed at the highest levels of government. The review will assess tax performance from July to January in light of prevailing inflation and economic growth trends.

Prime Minister Shehbaz Sharif has instructed the FBR not to impose any new taxes before June 30 and to meet the revised target without introducing a mini-budget.

Under the existing IMF programme, the annual tax target had already been lowered from PKR 14.131 trillion to PKR 13.979 trillion, although the revised figure has yet to receive formal parliamentary approval. If the IMF agrees to the new proposal, the target could be reduced further to PKR 13.879 trillion.

From July to January, the FBR collected PKR 7.147 trillion against a target of PKR 7.521 trillion, resulting in a shortfall of PKR 372 billion. Officials added that super tax revenues are expected to reach between PKR 217 billion and PKR 220 billion for the fiscal year, with nearly PKR 175 billion already collected.

Tax revenues during the first seven months of FY26 have grown by about 12 percent compared with PKR 6.699 trillion collected during the same period last year. Authorities are hopeful that increased consumer spending ahead of Eid may boost sales tax receipts, while any final adjustment to the target will depend on the outcome of IMF review discussions.