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Pakistan’s Four-Month Tax Shortfall Reaches Rs270–274bn as IMF Contingency Plan Nears January Trigger

Officials have tied the new levies to any first‑half deviation from revenue or spending targets.

Overview

  • FBR collected Rs3.84 trillion against a Rs4.109 trillion goal in July–October, with October revenue around Rs950–955 billion versus a Rs1.026 trillion target, leaving a Rs270–274 billion gap.
  • The government has committed to Rs200 billion in additional measures from January 1 under the IMF program, including a higher cash‑withdrawal withholding tax for non‑filers, increased telecom levies, an 18% GST on solar panels, and a 16% FED on confectioneries and biscuits.
  • Authorities say the contingency pledge helped secure a staff‑level agreement on the IMF’s second review, as the Fund resisted lowering primary‑surplus goals and the annual collection target was later trimmed after talks.
  • Tax refunds of about Rs205 billion issued in July–October reduced net receipts, with weak performance across income tax, sales tax, customs and excise deepening the shortfall.
  • Return filings hit a record 5.9 million, including 3.6 million with payments, while the prime minister ordered a review of high tax rates with proposals to cut corporate, individual and sales taxes that remain uncertain under the IMF program.