- Finance Minister Aurangzeb pledges to bring all traders into the tax net without exceptions.
- The FY25 budget aims for a Rs13 trillion revenue target, up 40% from the current fiscal year.
- Emphasis on economic stability and reforms, including reducing policy rates and increasing tax-to-GDP ratio.
WASHINGTON: Finance Minister Senator Muhammad Aurangzeb reiterated Pakistan’s commitment to expanding its tax base without exceptions during an interview at the G20 Finance Ministers and Central Bank Governors’ Meeting held during the IMF and World Bank’s 2024 annual Spring Meetings.
Addressing concerns raised by business leaders at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) regional office in Lahore, Aurangzeb emphasized the government’s ambitious fiscal strategy outlined in the national budget presented on June 12. The budget targets a substantial Rs13 trillion in revenue for the fiscal year starting July 1, marking a 40% increase from the previous year.
“We are resolute in bringing all traders under the tax net,” Aurangzeb affirmed, highlighting a 48% rise in direct taxes and a 35% hike in indirect taxes to achieve this goal. Non-tax revenue, including petroleum levies, is also expected to rise by 64%, reflecting the government’s efforts to shore up finances amid economic challenges.
Aurangzeb stressed the budget’s broader implications for achieving macroeconomic stability, emphasizing the need for comprehensive economic reforms. He underscored the importance of attracting both domestic and foreign investment to bolster Pakistan’s economic resilience.
Commenting on fiscal policy, Aurangzeb advocated for a gradual reduction in the policy rate to stimulate economic growth while targeting a significant increase in the tax-to-GDP ratio to 30% over the next three years. He also addressed public concerns over government expenditures, acknowledging the need to curb excessive allowances and privileges.
In concluding remarks, Aurangzeb highlighted the pivotal role of small and medium-sized enterprises (SMEs) and the IT sector in driving economic growth and stability, signaling the government’s commitment to supporting these sectors amidst broader fiscal reforms.
