Shehbaz Sharif rejects FBR tax proposals

The Prime Minister of Pakistan, Shehbaz Sharif, has recently made a decision regarding two crucial tax proposals presented by the Federal Board of Revenue (FBR) for the upcoming fiscal year's budget. The FBR had recommended increasing the sales tax on various items from 18 to 19 percent and imposing a tax of up to 18 percent on petroleum products. These proposals were aimed at boosting tax revenue for the government. However, Prime Minister Shehbaz Sharif has turned down these suggestions and has directed the FBR Chairman to explore alternative options.

It is important to highlight that the International Monetary Fund (IMF) had advised Pakistan to introduce a sales tax on petroleum products in recent discussions. Since March 2022, the government had suspended the sales tax on petroleum products and introduced the Petroleum Development Levy at Rs60 per liter instead.

The decision by Prime Minister Shehbaz Sharif to reject the FBR's tax proposals signifies a shift in the government's approach towards taxation policies. This move will have implications on the country's revenue generation and economic strategies. As the FBR explores alternative options, it remains to be seen how the government will navigate the challenges of balancing tax revenues and economic growth.