The Federal Board of Revenue (FBR) has outlined an aggressive plan to address Pakistan’s significant revenue shortfall, ahead of an anticipated visit by an International Monetary Fund (IMF) delegation. This development comes as Pakistan struggles to meet fiscal commitments critical for securing IMF support and stabilising its fragile economy.
The FBR aims to accelerate container clearances at ports, auction smuggled goods, and enhance enforcement capabilities. It also plans to increase tax collection from under-taxed sectors and expedite legal cases pending in courts to achieve its revenue goals.
For January, the FBR faces a daunting tax target of Rs960 billion. Factoring in an existing shortfall of Rs385 billion, the collection requirement has swelled to Rs1,340 billion. Officials have expressed confidence in implementing the necessary measures to ensure compliance with IMF benchmarks.
The upcoming IMF review will evaluate the progress on these initiatives, as well as other fiscal reforms, against the backdrop of Pakistan’s ongoing economic challenges.
In a separate report, the IMF revised Pakistan’s GDP growth projection for 2025 to 3%, down from the 3.2% forecast just three months ago. This adjustment, part of the IMF’s “World Economic Outlook Update: Global Growth – Divergent and Uncertain,” reflects persistent economic hurdles.
Despite the downgrade, Pakistan’s GDP growth is expected to remain at 4% in 2026. The IMF’s revisions align with the Asian Development Bank’s (ADB) recent forecast, which also estimated Pakistan’s growth at 3% for FY2024-25, up from 2.8%.
Both institutions acknowledge the challenges Pakistan faces but maintain a cautiously optimistic view for medium-term recovery.
Pakistan’s economy has been under severe pressure, with dwindling foreign reserves, a depreciating currency, and inflationary pressures exacerbating the fiscal landscape. Revenue generation remains a cornerstone of the country’s commitments under the IMF loan program, and any shortfall could jeopardize the financial assistance critical to averting a deeper economic crisis.
The FBR’s efforts to meet ambitious targets are crucial for bolstering fiscal credibility, particularly as Pakistan navigates a complex recovery path amid global economic uncertainty.
