ISLAMABAD: The International Monetary Fund (IMF) has proposed imposing an 18% General Sales Tax (GST) on petroleum products and solar systems, raising concerns about a potential increase in prices for both.
It has also suggested setting the tax collection target for the federal budget of fiscal year 2026–27 at over Rs. 15,600 billion, with an increase of more than Rs. 1,600 billion.
According to sources within the Federal Board of Revenue (FBR), the IMF has presented several key demands to the government.
These include significantly increasing the tax target for the upcoming fiscal year.
The IMF has specifically called for an 18% GST on fuel, including petrol, which is currently taxed at a zero rate.
Additionally, it has urged the government to impose an 18% tax on solar energy users and to withdraw tax exemptions currently available for new housing projects.
Furthermore, the IMF has recommended introducing asset-based taxation for small businesses and traders.
It has also proposed maintaining the new tax target above Rs. 15,600 billion in the upcoming budget.
For the current fiscal year, the tax target was reduced from Rs. 14,131 billion to Rs. 13,979 billion.
Despite this reduction of Rs. 152 billion, there has been a shortfall of Rs. 428 billion in tax collection during the first eight months.
