EDITORIAL: The government is hush-hush about the quantum of tax relief offered and new taxes imposed in the recently announced FY27 budget, as it has refused to share the numbers with the National Assembly Standing Committee on Finance. At the same time, Pakistan People’s Party (PPP) Chairman Bilawal Bhutto-Zardari appears to be visibly perturbed by the budget details, as he says that the budget numbers presented in the National Assembly are different from what were shown to PPP representatives earlier.
There is some confusion. Transparency is missing from the entire process. When officials are pressed, they shift responsibility to the IMF, saying that they cannot disclose the numbers while discussions with the IMF are ongoing. Well, all these deliberations and the number-sharing exercise were supposed to happen before the budget was presented, and there were rounds of discussions during which the government rightly remained silent on the matter.
However, now that the budget has been presented, after the finalization of discussions with the IMF (International Monetary Fund), it is time for the measures taken to be debated in the upper and lower houses of parliament, and in the media as well, so that the concerns of all relevant parties can be incorporated before the budget is passed. Suffice to say, keeping tight-lipped about the details sounds fishy.
Reportedly, the cost of tax relief is around Rs360 billion, including Rs115 billion on property and Rs52 billion in salaried tax reductions. Lowering taxes on business/first class travel and reducing With-holding Tax on international credit and debit card transactions are expected to cost Rs41 billion. And the list goes on.
When the numbers are covered in the press and verified through sources why doesn’t the government state them upfront? Why is it hiding them? Add to this the PPP chairman’s concerns that what was presented was different from what had been agreed with the coalition partners. This is a legitimate concern and undermines the entire process.
The budget package reportedly has eleven relief measures, ten rationalization measures and five administrative reforms. The relief being given ought to be covered by additional revenue and enforcement measures. There are no details about how much is to be collected through additional measures. That leaves the burden on enforcement.
Here is the catch. Historically, FBR enforcement has essentially fallen on the thin, already-taxed sector. The FBR chairman, in his speeches, has talked about the gaps among the top 1 percent. Some fear that the FBR may continue pressing the small base to pay more in advance taxes and could use coercive measures to generate more revenue. If that happens, the feel-good factor will vanish.
Then there are some issues with coalition partners that could create friction going forward. It appears that the government is saying one thing to the business community while having other commitments with the IMF. It also has separate agreements with the coalition partners. One may suspect that there are gaps between them, which is why the government is being too secretive about the details.
The government must not derail the process and should be transparent and clear about everything. Otherwise, things will start unfolding when the fiscal year begins, adding complications. Therefore, needless to say, the mistrust between taxpayers and the tax authorities will only widen.
Copyright Business Recorder, 2026
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