IMF Pushes Pakistan to Recover Super Tax Arrears Within a Month

Islamabad: (Web Desk) – The International Monetary Fund (IMF) has urged the Pakistan government to complete all pending recoveries of the Super Tax within a month, following a Supreme Court ruling in favor of the levy.

Sources said virtual discussions were held between the IMF and the Federal Board of Revenue (FBR) after the court’s decision. The IMF expressed satisfaction over the verdict and stressed the importance of meeting tax collection targets.

The FBR expects to collect nearly Rs375 billion in Super Tax by the end of the current fiscal year, with around Rs300 billion likely to be recovered in the coming days. As of December 2025, liabilities of large business units stood at approximately Rs340 billion, with an additional Rs40 billion expected by June 2026. Officials expressed confidence that the revenue shortfall could be cleared by December through Super Tax recoveries.

The FBR reported a revenue shortfall of about Rs335 billion against the Rs6,490 billion target for July–December, with Rs310 billion shortfall recorded between July and November and Rs25 billion in December. Total collections for the first half of the fiscal year reached Rs6,155 billion.

The Super Tax applies to high-income individuals, large corporations, banks, and highly profitable sectors, with rates ranging from 1% to 10% under Sections 4B and 4C of the Income Tax Ordinance. Companies earning annual profits between Rs150 million and Rs200 million pay 1%, while profits exceeding Rs500 million are taxed at 10%.

Under proposed reforms, the manufacturing sector’s Super Tax rate would be gradually reduced to 5% over four years and abolished in the fifth year if a primary budget surplus is achieved. The minimum profit threshold for manufacturing companies would rise from Rs200 million to Rs500 million, and the 10% rate would apply only to profits above Rs1.5 billion. These proposals are awaiting IMF approval.

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Sources added that the Prime Minister has directed the FBR to accelerate enforcement, confirmed that no mini-budget will be introduced before the next fiscal budget, and instructed the economic team to prepare relief measures for salaried individuals and industries. The Ministry of Finance has issued guidelines prioritizing revenue enhancement over new taxes to close fiscal gaps.