The International Monetary Fund has urged Pakistan to cover its revenue shortfall by ensuring full recovery of the Super Tax, following a Federal Constitutional Court ruling that upheld Section 4B of the Income Tax Ordinance, 2001. The court dismissed challenges to the Super Tax and partially nullified earlier High Court judgments concerning Section 4C, clearing the way for the Federal Board of Revenue to accelerate collections.
The FBR recorded a revenue shortfall of Rs335 billion in the first half of the current fiscal year, prompting virtual discussions with the IMF. The IMF welcomed the court’s decision and emphasized that pending Super Tax recoveries be completed within the current month. Estimates indicate that total Super Tax collections could reach around Rs380 billion by June 2026, with Rs300 billion expected in the coming days and the remaining Rs80 billion by mid-year. Completion of these recoveries is projected to eliminate the FBR’s revenue gap by December.
The FBR’s legal wing has finalized preparations to pursue any remaining Super Tax cases in the Supreme Court, under pressure from the IMF to resolve pending litigation. Under the Finance Bill, Super Tax applies to large companies at rates ranging from 1 percent to 10 percent depending on profitability. Authorities have emphasized that the revenue shortfall will be addressed through increased tax collection rather than new short-term measures or mini budgets.
