The Federal Board of Revenue (FBR) Rashid Mahmood Langrial has indicated that the upcoming federal budget for the fiscal year 2025-26 will be a tough one, with no sales tax reductions or concessions, except for potential relief for the salaried class, subject to the International Monetary Fund’s approval.
The FBR chairman said that the IMF mission would be visiting Pakistan around the second week of May 2025 to discuss budgetary proposals.
According to media reports, Langrial made the announcement during a meeting of the Standing Committee on Finance and Revenue at the Parliament House on Wednesday.
Finance Minister Muhammad Aurangzeb, attending the meeting remotely from Karachi, also confirmed that tax relief for salaried individuals is under consideration for the next budget. It was revealed that the FBR has been working on significant tax relief measures for the salaried class.
In response to a proposal by the dairy sector to reduce sales tax on milk from 18% to 5%, the FBR chairman stated that such reductions are not possible due to the ongoing IMF program, which restricts changes in sales tax rates. He further explained that the country is facing difficulties in revenue collection, as economic assumptions used to set tax targets for the 2024-25 fiscal year, such as GDP growth and inflation, have been revised.
The FBR chairman also noted the establishment of a tax policy unit at the Ministry of Finance. However, the 2025-26 budget will continue to be reviewed by the FBR until this unit becomes fully operational.
During the meeting, the committee addressed 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. The bill received unanimous support from the members, and a Sub-Committee was formed to examine it further.
Another issue under review was the “Inquiry Regarding the Constitutional Validity of Section 99D of the Income Tax Ordinance, 2001,” raised by MNA Syed Hafeezuddin.
The committee also received a briefing from the president of Zarai Taraqiati Bank Limited (ZTBL), where concerns were raised about the bank’s focus on profit-making over supporting agriculturalists.
The committee urged the bank to expand its loan base and introduce user-friendly initiatives, including credit cards for farmers and incentives for timely repayment.
The committee also expressed concerns about the potential privatization of ZTBL and instructed the bank to provide a province-wise breakdown of its loan disbursements.
The meeting concluded with the unanimous approval of the minutes from the previous meeting. Senior officials from the Ministry of Finance, FBR, and other relevant departments attended the session.
