Pakistan Considers Mini-Budget to Meet Tax Shortfall, Fund Flood Rehabilitation

Islamabad – Pakistan’s government is weighing the introduction of a mini-budget aimed at addressing revenue shortfalls and financing rehabilitation efforts for flood-affected communities, according to officials from the Federal Board of Revenue (FBR).

The proposed measures include additional levies on luxury vehicles, cigarettes, and imported electronics. Authorities are considering a 5% levy on electronic goods, while high-end vehicles with engines of 1,800cc and above could face new taxes. However, any such measures would require approval from the International Monetary Fund (IMF).

Officials said the government aims to raise at least PKR 50 billion through the package. Among the proposals is a PKR 50 levy on every cigarette pack, with proceeds going directly to the federal government rather than being shared with provinces.

The plan comes amid a revenue shortfall of PKR 50 billion in August, when the FBR collected PKR 901 billion against a target of PKR 951 billion. Overall, July–August revenues fell short by around PKR 40 billion.

Pakistan has set a revenue collection target of PKR 14.13 trillion for the current fiscal year, but floods, reduced energy consumption, and sluggish business activity have hampered collections.