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Business Recorder
2 days ago
- Business
- Business Recorder
Govt unveils ambitious digital overhaul for FBR in Budget 2025–26
The Federal Board of Revenue (FBR) is set to undergo a sweeping digital transformation as part of the government's strategy to modernise Pakistan's tax administration and improve revenue collection, according to the federal budget speech presented by Finance Minister Muhammad Aurangzeb for FY2025–26 on Tuesday. Aurangzeb presented the federal budget for the second time as the coalition government sought to revive the economy, meet the International Monetary Fund (IMF) benchmarks and provide some relief to the tax-weary masses. FBR Tax Target The Federal Board of Revenue (FBR) is assigned to collect Rs14.13 trillion in FY26, up 19% as compared to Rs11.9 trillion revised estimates for FY25. The tax collection for FY26 includes Rs6.9 trillion in direct taxes and Rs7.2 trillion in indirect taxes. Key components of the transformation The reform plan includes a nationwide rollout of Digital Production Tracking, aimed at monitoring manufacturing output and linking it with digital invoicing systems. This move is expected to reduce underreporting of production and ensure greater documentation of business activity. To further strengthen documentation, the FBR is expanding business-to-business (B2B) e-Invoicing, making it mandatory across multiple sectors. The plan also includes deeper integration of the Point of Sale (POS) system for retailers and the deployment of an E-way Billing framework to digitally track the movement of goods. In a significant shift away from traditional audit practices, the FBR will fully implement Faceless Audit and Faceless Customs Audit systems. These aim to eliminate human discretion in audit processes, reduce corruption, and improve taxpayer confidence. Technology-led enforcement Artificial Intelligence (AI) will be used for risk-based audit selection, while fraud analytics tools will support customs enforcement and refund scrutiny. A Central Control Unit is being established to provide real-time visibility and centralised oversight across all enforcement and compliance operations. Workflow digitisation is also being prioritised, with automated alerts and a digital case management system intended to expedite processing and enforcement without bureaucratic delays. Institutional support and capacity building The transformation will be supported by the PRAL Board, which will oversee IT governance and system upgrades. Additionally, the government plans to introduce 'Audit Mentors' within the FBR to guide staff through the transition and promote digital literacy. According to budget documents, these reforms are not only targeted at boosting the tax-to-GDP ratio – currently one of the lowest in the region – but also at aligning Pakistan's tax administration with global best practices. What this means for taxpayers For taxpayers and businesses, the FBR's digital push signals a future of increased compliance obligations but potentially fewer bureaucratic hurdles. E-invoicing, production tracking, and centralised audits will make non-compliance harder and speed up legitimate processing. The government's digital transformation agenda is expected to gain traction over the fiscal year, with multiple milestones scheduled for rollout through FY2026.
Business Recorder
17-05-2025
- Automotive
- Business Recorder
Electric vehicles technology: Ministry vows to provide facilities, incentives
ISLAMABAD: The Ministry of Industries and Production is committed to provide all the facilities, incentives and encouraging local industrialists to invest in Electric Vehicles (EV) technology to foster domestic manufacturing and reduce reliance on imports. The Special Assistant to the Prime Minister (SAPM) on Industries and Production Haroon Akhtar Khan said this here on Friday, while chairing a meeting to discuss the matters pertaining to automobile sectors with special focus on EVs. Haroon stressed that EVs and lithium batteries represent the future of technology, adding Pakistan must embrace these innovations to remain competitive. The SAPM emphasised that EV will bring significant economic and environmental benefits to the country. Citing a Pakistan Bureau of Statistics (PBS) report, he highlighted that 28.7 million motorcycles are currently running on petrol, costing the nation billions of rupees annually. In line with the prime minister's directives, the Ministry of Industries and Production will provide necessary support to local manufacturers in adopting EV technology. This initiative is expected to significantly reduce fuel imports and deliver long-term economic benefits. Notably, data from COMSATS revealed that while petrol bikes cost Rs6.9 per kilometre, electric bikes cost only Rs0.7 per kilometre, demonstrating the cost efficiency of electric mobility. The meeting to discuss EV technology and motorcycle retrofitting with a delegation from COMSATS. The meeting was attended by Secretary Ministry of Industries and Production Saif Anjum, Executive Director COMSATS Nafees Zakaria, and CEO of the Engineering Development Board Khuda Bakhsh Ali. Transitioning to electric mobility will not only reduce fuel expenses but also align with the Prime Minister's Vision for a Green Pakistan, which prioritises eco-friendly technology. The National Electric Vehicle Policy was underscored as a key driver for Pakistan's economic growth and environmental sustainability. The government is committed to encouraging local industrialists to invest in EV technology to foster domestic manufacturing and reduce reliance on imports. Copyright Business Recorder, 2025
