Pakistan Sets 11.2% Tax-to-GDP Target for FY 2025–26 in Line with IMF Deal

Islamabad –The Government of Pakistan, in collaboration with the International Monetary Fund (IMF), has set a tax-to-GDP target of 11.2% for the financial year 2025–26, sources from the Federal Board of Revenue (FBR) confirmed.

According to officials, the target has been determined based on estimates of the upcoming fiscal year’s GDP. This move follows an agreement with the IMF as part of ongoing financial cooperation.

The current tax-to-GDP ratio target for the ongoing fiscal year stands at 10.6%, but it has already reached around 10.8%, showing positive progress. The government aims to gradually increase this ratio to 13% over the coming years.

Sources further revealed that virtual discussions between FBR and IMF teams were held to finalise budgetary targets. Approval of the second tranche under the IMF loan programme will follow once these proposals are complete.