ISLAMABAD – Finance Minister Muhammad Aurangzeb announced on Thursday that artificial intelligence (AI) will be employed to enhance tax collection, highlighting concerns over Pakistan’s uneven tax burden.
Speaking at the “Retail Reimagined: Innovate, Collaborate & Thrive” conference, organized by the Pakistan Retail Business Council (PRBC), he pointed out that despite contributing 19% to GDP, the retail sector only pays 1% in taxes. He stressed that manufacturing, services, and salaried workers bear an unsustainable tax burden and urged the inclusion of agriculture, real estate, retail, and wholesale sectors in the tax net.
He acknowledged provincial governments’ efforts to impose agricultural taxes and emphasized the need for businesses to formalize and contribute their fair share. “For the national interest, we can’t allow free riders anymore,” he stated, stressing the importance of documentation.
Later, addressing the media, he reaffirmed AI’s role in improving tax collection. He noted that Rs9.4 trillion in cash remains outside the formal economy and stressed the government’s commitment to integrating it over time.
Aurangzeb highlighted economic improvements, citing currency stabilization, increased foreign exchange reserves, reduced inflation, and a decline in Kibor from 23% to 11%. These factors have drawn renewed interest from foreign investors in Pakistan’s economic potential.
Pakistan is also working with international rating agencies to secure a credit rating upgrade to the “Single B” category, which would enhance investor confidence and restore access to global financial markets.
The government, he added, is prioritizing sustainable, inclusive growth rather than short-term economic cycles. Structural reforms in taxation, energy, state-owned enterprises (SOEs), and public finance are underway, with a focus on digitization to improve transparency and reduce corruption. The introduction of faceless customs has already cut import clearance times from 118 hours to 18-19 hours, eliminating the need for bribes.
