Summary Pakistan is awaiting IMF approval for budget proposals that include tax relief for salaried individuals, lower super tax rates and incentives for key economic sectors
ISLAMABAD (Web Desk) - The federal government is awaiting approval from the International Monetary Fund (IMF) on a series of tax relief proposals, including significant concessions for salaried individuals, before finalising the Budget 2026-27.
According to a report by a private television channel, the government is in the final stages of preparing the upcoming budget, but implementation of several key tax measures and relief packages remains dependent on IMF approval.
Sources said the government has presented various proposals to the global lender aimed at providing relief to different sectors of the economy and introducing changes to the tax regime.
Among the proposals under consideration are reductions in income tax slabs for salaried individuals, a two-percentage-point cut in the super tax rate and the abolition of the one per cent advance income tax currently imposed on the export sector.
The government is also considering a number of incentives and facilitation measures for the property sector in an effort to encourage investment and stimulate business activity.
At the same time, discussions are underway regarding tax increases on certain products.
Sources stated that, consultations with the IMF continue over proposals to raise the General Sales Tax (GST) on solar panels, hybrid vehicles and more than 20 other items to the standard rate of 18 per cent.
The government has also requested that lower tax rates be maintained on electric vehicles to support the adoption of environmentally friendly technologies. Officials say the proposal has been linked to energy security objectives and environmental targets under the $1.4 billion Resilience and Sustainability Facility programme.
Meanwhile, tax revenue targets remain a major challenge for the government. Official sources said the Federal Board of Revenue's collection target for the current fiscal year has been revised down to Rs13.428 trillion, while a proposal is under consideration to raise the target to Rs15.264 trillion in the next fiscal year.
Officials said detailed consultations between the government and the IMF are continuing on various fiscal options to help achieve the ambitious revenue goals.
