ISLAMABAD – The IMF has demanded the imposition of 18% GST on petroleum products and solar systems, raising concerns of further price hikes. It has also proposed setting the tax collection target for the 2026–27 federal budget at over Rs15.6 trillion, with an increase of more than Rs1.6 trillion.
According to reports, the IMF has made several demands, including a significant increase in next year’s tax target. It has called for 18% GST on fuel, including petrol, which is currently taxed at zero percent, and has also pushed for the same tax on solar consumers.
Additionally, it has urged the removal of tax exemptions for new houses.
Reports further said the IMF has proposed asset-based taxation on small businesses and traders. While the current year’s target was reduced from Rs14.131 trillion to Rs13.979 trillion, a shortfall of Rs428 billion has already been recorded in eight months.
Officials warned that the shortfall could exceed Rs600 billion in the first nine months of the fiscal year. So far in March, over Rs865 billion has been collected against a target of Rs1.367 trillion. Factors cited include reduced imports due to conflict and a slowdown in business activity caused by expensive fuel.
The FBR remains hopeful of covering the gap through super tax and surcharges, while Finance Ministry officials say further talks with the IMF will take place before the new budget.
