Pakistan Seeks Alternatives Amid Revenue Shortfall Challenge

Pakistan faces a revenue shortfall of PKR 385 billion. The IMF suggests a mini-budget, but Prime Minister Shehbaz Sharif directs the FBR to find alternatives. The FBR's plan includes expediting port clearances, auctioning seized goods, combating tax evasion, and resolving tax disputes to boost revenue.

Pakistan is confronting a significant revenue shortfall of PKR 385 billion for the period from July to December 2024, as ARY News disclosed on Wednesday, citing unnamed sources. The International Monetary Fund (IMF) has advised Islamabad to introduce a mini-budget to bridge this financial gap; however, Prime Minister Shehbaz Sharif has dismissed the suggestion.

Sharif has instead tasked the country's Federal Board of Revenue (FBR) with devising alternative strategies to counteract the deficit. In response, the FBR has drafted a robust plan aimed at boosting revenue collections without burdening the public with new taxes. Key elements of the strategy include prioritizing the clearance of stagnant containers and shipments at ports to enhance tax and duty income and quickly auctioning confiscated smuggled goods.

The FBR also intends to fortify its campaign against tax evasion and increase tax compliance in underserved sectors. Furthermore, it plans to expedite the resolution of tax-related legal disputes. With the IMF delegation scheduled to visit Pakistan soon, the FBR hopes to implement these initiatives swiftly, setting an ambitious target of collecting PKR 960 billion in taxes by January. The entire plan is expected to be operational by March to address the looming revenue crisis.

(With inputs from agencies.)