Govt bets on higher growth, expanded tax base

Eyes 5.1% growth, Rs15.5tr tax target in next budget

ISLAMABAD:

The federal government is likely to set a GDP growth target of 5.1 per cent and a tax collection goal exceeding Rs15.5 trillion in the budget for the next fiscal year (2026–27), even as global lenders expect the economy to expand at a slower pace.

Finance ministry sources said preparations for the upcoming budget are in the final stages, with proposals received from various stakeholders under review and workable suggestions being incorporated.

The budget is being aligned with benchmarks agreed under the International Monetary Fund (IMF) programme.

The global lender's review mission is expected to visit Pakistan next month to hold detailed consultations before finalising the proposals.

The government is likely to present the budget in parliament in the first ten days of June.

According to the sources, the proposed growth target of 5.1 per cent represents an increase from the 4.2 per cent target set for the ongoing fiscal year.

However, the IMF, World Bank (WB) and Asian Development Bank (ADB) have projected lower growth than the government's estimate.

On the revenue side, the government is considering setting a tax target of over Rs15.5 trillion for 2026–27, compared to Rs14.131 trillion for the current fiscal year.

Despite a downward revision in targets, the Federal Board of Revenue (FBR) has recorded a shortfall of Rs610 billion in the first nine months of the current fiscal year.

To broaden the tax base, the government aims to add one million new income tax return filers by June this year, followed by a further 750,000 by March next year.