Islamabad (HRNW) – The federal government is reportedly awaiting approval from the International Monetary Fund (IMF) for a series of proposed tax relief measures and fiscal adjustments planned for the upcoming Budget 2026-27.
According to media reports, the government is in the final stages of preparing the new budget and has presented several proposals to the IMF aimed at providing relief to taxpayers and supporting economic activity in key sectors.
Sources indicate that the proposals include reducing income tax rates for the salaried class, cutting the super tax by 2 percent and abolishing the one percent advance income tax currently imposed on the export sector.
The government is also considering incentives for the property sector to encourage investment and stimulate business activities. These measures are intended to support economic growth and improve market confidence.
At the same time, discussions are underway regarding possible tax increases on selected products. According to reports, consultations with the IMF include a proposal to apply the standard 18 percent General Sales Tax (GST) rate to solar panels, hybrid vehicles and approximately 20 other items.
However, government officials have reportedly requested that electric vehicles continue to receive relatively lower tax rates in order to promote environmentally friendly technologies, energy efficiency and sustainability goals. The proposal is also linked to broader climate and development initiatives, including funding available through international sustainability programs.
Tax collection targets remain a key challenge for policymakers. Sources say that while the Federal Board of Revenue (FBR) target for the current fiscal year has been revised to Rs 13.428 trillion, a proposed target of Rs 15.264 trillion is under consideration for the next fiscal year.
Officials stated that detailed discussions between Pakistan and the IMF are continuing as both sides review fiscal options and revenue measures ahead of the final budget announcement.
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