ISLAMABAD: (Mudassar Iqbal) – Federal Minister for Finance and Revenue Senator Mohammad Aurangzeb has said that Pakistan’s economy is moving in the right direction, with government policies beginning to produce positive outcomes.
Addressing the Pakistan Banking Summit 2026 in Karachi on Tuesday, the finance minister said the government had introduced several measures to boost economic activity, encourage documentation and strengthen the overall economic framework.
Aurangzeb highlighted various tax-related reforms included in the latest budget, including reductions in advance tax, subsidies and super tax. He said businesses with an annual turnover of up to Rs500 million had been fully exempted from super tax.
He added that the tax rate on agricultural machinery had been reduced to zero, while conditions for providing easier loans to farmers had also been relaxed.
The minister said the tax burden on salaried individuals had been lowered and described the willingness of retailers to enter the tax system as a positive development.
He said the government had limited the powers of income tax officials to facilitate the business community and had taken important steps toward digital transformation and the adoption of modern technology. Aurangzeb emphasized that with a population of around 250 million, Pakistan needed a simpler tax structure while expanding the tax base.
The finance minister also pointed to reductions in petroleum prices as a measure aimed at providing relief to citizens, adding that indicators showed improvement in the country’s GDP growth outlook.
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Clarifying that decisions regarding the policy rate fall under the authority of the State Bank governor, Aurangzeb noted that Roshan Digital Accounts had attracted an additional $300 million in inflows over the past three years, reflecting overseas Pakistanis’ confidence in the country’s financial system.
He further announced that a special task force would be established to support Small and Medium Enterprises (SMEs). The government, State Bank, banking sector representatives and relevant institutions will collaborate to improve access to financing and provide easier loans to small businesses.
Aurangzeb said strengthening SMEs alongside large-scale industries would help increase economic activity and enable the sector to play a greater role in Pakistan’s national growth.
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