Islamabad: Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial has ruled out the introduction of new taxes despite a revenue shortfall of PKR 275 billion recorded during the first four months (July–October) of the fiscal year 2025–26.
Speaking during a presentation on economic reforms at the FBR Auditorium on Monday, Langrial said the government would not resort to contingency tax measures to bridge the gap, emphasizing that improved compliance and broadening the tax base remain the primary focus of the FBR’s strategy.
He said that last year no emergency taxation measures were taken and the same policy would continue this year. “There is no immediate need to impose new taxes. Our priority is to strengthen compliance and expand the tax net,” the chairman stated.
Langrial revealed that tax compliance indicators have improved notably during the year, with income tax return filings rising by 18% to reach 5.9 million. However, he noted that taxes paid along with the returns during FY2024–25 amounted to only PKR 69 billion.
The FBR chief added that the tax-to-GDP ratio increased by 1.5 percentage points — from 8.83% in FY2023–24 to 10.33% in FY2024–25 — marking the highest growth in the past 23 years. He said the government aims to raise the overall tax-to-GDP ratio to 18% within the next three to four years, in collaboration with provincial governments.
Explaining the distribution of revenue responsibilities, Langrial said the federal government aims to collect 15% of the total revenue while provinces are expected to contribute 3%. He observed that the federation faces greater fiscal pressure compared to the provinces.
Langrial also spoke about the operational challenges faced by enforcement teams, noting that tax officials have faced security threats during field operations. “Two of our officers were martyred in the suburbs of the Kohat tunnel. Our mission is to enforce compliance, not confrontation. With the support of Rangers and other institutions, this work has become safer and more effective,” he said.
The chairman stated that policy reforms have strengthened the FBR’s independence and reduced political interference, allowing it to focus on structural improvements and modernization. Over 160 Rangers personnel are currently assisting the agency in enforcement operations, he added.
Langrial highlighted that the country’s income tax gap stands at PKR 1.7 trillion — with PKR 1.2 trillion attributable to top-income earners — underscoring the need for stronger compliance mechanisms.
He further mentioned that the FBR had secured approval for a transformation plan initiated last November, which includes the introduction of digital tools and enhanced coordination with other institutions to improve transparency and efficiency.
Langrial concluded that the FBR’s focus is now on consolidating reforms and enhancing collection efficiency rather than imposing new taxes. He said major progress has been achieved in sectors such as tobacco, while additional initiatives are underway to expand the tax base and strengthen Pakistan’s fiscal position.
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