Pakistan and the International Monetary Fund (IMF) have finalized an agreement to lower the Federal Board of Revenue’s (FBR) annual tax collection target by Rs. 150 billion, adjusting it from Rs. 14.131 trillion to Rs. 13.981 trillion. The revision reflects ongoing economic pressures, including the impact of recent floods and slower-than-expected recovery in key sectors.
Under the revised framework, Pakistan is targeting a 3.5% GDP growth rate and an 11% tax-to-GDP ratio for the fiscal year, aligning with efforts to maintain macroeconomic stability while ensuring fiscal sustainability. The decision aims to provide breathing space to the economy, balancing growth objectives with realistic revenue expectations.
Additionally, Pakistan and the IMF have agreed to update the Memorandum of Economic and Financial Policies (MEFP) to incorporate the revised macroeconomic indicators. These adjustments will be included in the upcoming IMF country report, which will outline the government’s fiscal strategy, revenue performance, and progress on structural reforms.
