Punjab to set up unified revenue authority as collection target rises 46%

The Punjab government will establish a unified revenue authority modelled on the Federal Board of Revenue during 2026-27, bringing provincial taxes under a single institutional framework as it raises its revenue collection target by 46%.

Punjab Finance Minister Mujtaba Shuja-ur-Rehman announced the plan at a post-budget press conference on Wednesday, saying the province had achieved 99% of its tax collection target during the outgoing fiscal year.

He said Punjab’s own-source revenue was expected to grow by 30% to 40% during the next fiscal year and expressed confidence that the higher collection target would be achieved.

Under the proposed revenue plan, the Punjab Revenue Authority has been assigned a collection target of Rs528 billion, while the Excise and Taxation Department will be required to collect Rs124 billion.

Non-tax revenue-generating departments have been given a combined target of Rs461 billion.

The minister said the Punjab Revenue Authority collected 30% more than its assigned target during the outgoing year, while collections by the Excise and Taxation Department increased by 12%.

Among departments collecting non-tax revenue, the Mines and Minerals Department was the largest contributor.

Shuja-ur-Rehman said the provincial government had not introduced new taxes or increased existing tax rates during the previous two years. Revenue collections, he said, had improved through expansion of the tax base and measures to reduce corruption in tax administration.

However, the government has proposed limited revisions to some existing tax rates for 2026-27 in view of prevailing economic conditions.

The minister said several of the rates proposed for revision had remained unchanged for decades.

Changes to agricultural income tax would apply only to landholdings exceeding 12.5 acres, he said, adding that the existing regime had not been revised since 1998.

The provincial government is also digitising the property tax system to reduce manual intervention and improve collection efficiency.

Shuja-ur-Rehman said Punjab’s decision to provide a Rs546 billion grant to the federal government had affected the size of the provincial development programme, which was reduced from Rs1.24 trillion to Rs752 billion.