Overview
- Policymakers are considering requesting relaxations on primary balance and provincial surplus targets to create fiscal space in 2026–27.
- The government may seek permission for a higher fiscal deficit next year to support investment and economic activity.
- A draft industrial policy proposes phasing down the manufacturing super tax to 5% over four years and removing it in year five if a primary surplus is achieved.
- Plans under review include lower power tariffs, higher income thresholds for the super tax, and leveraging easing inflation to push for a cut in the policy rate.
- Prime Minister Shehbaz Sharif has directed the Finance Ministry and FBR to work with businesses, and the SIFC has been tasked with steps to boost investment, though IMF approval remains uncertain.