13-05-2025
Pakistan PM prioritizes tax net expansion, vows crackdown on evaders
ISLAMABAD: Prime Minister Shehbaz Sharif on Tuesday declared the expansion of Pakistan's tax base as his administration's foremost priority, emphasizing the need to take decisive action against tax evaders and the officials who enable them.
Sharif's remarks came during a high-level meeting in Islamabad focused on enhancing tax collection and broadening the tax net, according to a statement from the Prime Minister's Office.
Tax reform has been a central condition of Pakistan's ongoing $7 billion loan program with the International Monetary Fund (IMF), which has asked Islamabad to boost revenue collection.
'Expanding the tax net is the government's top priority,' Sharif said. 'We want to reduce the tax rate to ease the burden on the common man.'
'Individuals and sectors capable of paying taxes but currently outside the tax net must be brought within it,' he added. 'Comprehensive action should be taken against tax evaders, and strict accountability must be ensured for officials and personnel who assist them.'
The government has implemented several measures to strengthen the tax collection mechanism, including the digitization of tax monitoring systems and the deployment of track-and-trace technology in key industries.
According to the PM Office, the introduction of these systems in cement plants nationwide has led to significant increases in tax revenue, while the sugar sector saw a 35% rise in tax receipts between November 2024 and April 2025.
Pakistan's tax-to-GDP ratio, historically among the lowest in the region, stood at 8.8% in the 2023-24 fiscal year.
However, Finance Minister Muhammad Aurangzeb projected it would reach 10.6% by June 2025, marking progress toward the government's target of 13% by the conclusion of the IMF's 37-month Extended Fund Facility.
The meeting tax collection, attended by key cabinet members and senior officials from the Federal Board of Revenue (FBR), also addressed the need for timely resolution of pending tax litigation and the completion of digital monitoring systems in sectors such as cement and tobacco by June.
'By the grace of God, the national economy is stabilizing and progressing,' Sharif said. 'Everyone must fulfill their responsibilities for the country's development.'
