IMF Questions Government Plan After Super Tax, Salary Cuts

International Monetary Fund – (Web Desk) – The International Monetary Fund (IMF) has raised questions about Pakistan’s plan to increase revenue in the next budget. This concern comes after the government suggested ending the super tax and lowering tax rates for salaried workers. The development was reported by The News on Tuesday.

IMF officials are holding online talks with Pakistani authorities these days. The IMF believes some short term steps could help the Federal Board of Revenue collect around Rs13,400 to Rs13,500 billion by June 2026. These steps include resolving legal cases, stronger tax enforcement, and collecting pending super tax payments. Still, the IMF wants to know how Pakistan will meet its tax target for the 2026 to 2027 fiscal year.

Pakistani officials say these steps should not be called temporary. They explain that many tax cases are still waiting in courts. If these cases are settled, the government could receive billions of rupees in the coming budget.

Sources say the IMF team will hold more discussions with Pakistan in May 2026. These talks will focus on final plans for the next federal budget and the country’s financial strategy.

The IMF has also suggested adjusting the value of the Pakistani rupee against the US dollar using the Real Effective Exchange Rate. If this happens, the rupee could fall to around Rs290 to Rs300 per dollar. Right now, the dollar is trading near Rs280.

Earlier, a meeting at the Prime Minister’s Office discussed the idea of removing the super tax. The government also plans to reduce the tax rate for salaried people by five percent in the next budget.

During an online meeting last Friday, IMF officials raised serious concerns. They asked how Pakistan would achieve next year’s tax target if taxes are reduced and the current increase in revenue comes mainly from short term steps.

Sources say it may be too early to expect that the IMF will agree to end the super tax. The IMF also asked the government where it will find about Rs150 billion if the super tax is removed completely.

Meanwhile, the government has created a new Tax Policy Office in the Ministry of Finance. IMF officials are expected to hold more virtual meetings after the IMF and World Bank Spring Meetings. These meetings will take place in Washington from April 13 to April 18, 2026.

After the spring meetings, the IMF team will again talk with the Pakistani government to finalise the budget for 2026 to 2027. The new Tax Policy Office has already started work on budget proposals for the next financial year.

Officials say if the government wants to lower tax rates, it will need new ways to collect revenue. This will help fill the gap created by tax cuts.

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Sources also say tax rates for people in higher salary brackets may be reduced. This step could cost the government around Rs15 to Rs20 billion. The Federal Board of Revenue will need to suggest other ways to collect this amount before the IMF agrees to the plan.