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The federal government has indicated targeted tax relief for the salaried class and registered businesses in the upcoming budget, as it expresses confidence that Pakistan’s economic growth will exceed global estimates this fiscal year. The assurance was given by Adviser to the Finance Minister Khurram Shahzad during a media interview, where he outlined key economic priorities including tax rationalisation, energy tariff relief, and structural reforms.
Speaking on a news channel, Khurram Shahzad said the government is preparing specific measures to ease the financial burden on salaried individuals and compliant businesses that are already part of the documented economy. He stated that the focus has shifted toward rewarding taxpayers who regularly file returns and contribute to national revenue.
“Targeted steps are being finalised to reduce pressure on the salaried class and registered businesses,” Shahzad said, adding that work is also underway to rationalise tax rates and lower energy tariffs to provide meaningful relief.
On the broader economic front, the finance adviser expressed optimism that Pakistan’s growth rate will outperform projections made by international institutions, including the IMF. He projected GDP growth of up to 4 percent for the current fiscal year, with an increase to around 5 percent next year. He also noted that remittances are expected to surpass $41 billion, strengthening the country’s external account.
Discussing Pakistan’s engagement with the IMF, Shahzad said preparatory work for the next economic review is ongoing. He acknowledged the country’s history of recurring IMF programmes due to structural weaknesses but stressed that the current approach is focused on sustainable and cautious policymaking to avoid repeated balance of payments crises.
As part of agreed structural benchmarks, he confirmed that 24 loss-making state owned enterprises will be privatised to reduce pressure on public finances.
Shahzad highlighted that inflation has eased significantly, dropping from 25 to 30 percent to around 5 percent, offering some relief to households. He added that the government’s long-term objective is to increase citizens’ earning capacity and boost exports through economic stability.
In a separate post on X, the adviser pointed out weaknesses in tax collection, particularly at the provincial level. He noted that while the federation collected Rs13 trillion last year, provinces contributed only Rs979 billion, far below global and national benchmarks. He stressed that improving revenue generation, rather than expanding the tax base, remains the real challenge.
