Adviser says revised projections reflect macroeconomic changes, denies claims of fiscal shortfall or revenue crisis
Pakistan has revised downward the Federal Board of Revenue’s (FBR) tax collection target for fiscal year 2025-26 (FY26) to around Rs13 trillion, down from the original Rs14.13 trillion, according to the Finance Ministry adviser, who said earlier claims of a large revenue shortfall were misleading.
Khurram Schehzad, Adviser to the Finance Minister, said in a post on social media platform X on Monday that fiscal projections are routinely adjusted to reflect changing macroeconomic conditions rather than being treated as fixed benchmarks.
He said tax targets are initially set before the start of each fiscal year based on assumptions including GDP growth, inflation, imports, industrial output, exchange rates and policy rates. These assumptions are later revised in consultation with the International Monetary Fund (IMF) as economic conditions evolve.
According to him, the downward revision reflects updated economic realities, including inflation volatility, a stronger-than-expected exchange rate—below Rs280 per dollar compared to the budget assumption of Rs296—slower growth trends, domestic disruptions such as floods, and external shocks including geopolitical tensions and commodity price fluctuations.
He said such revisions are a normal feature of fiscal management aimed at aligning revenue and expenditure projections with actual economic performance.
Providing monthly figures, Schehzad said the Federal Board of Revenue collected Rs994 billion in May 2026, achieving 97% of the monthly target. During the first eleven months of the fiscal year, cumulative tax collection reached Rs11,257 billion, which he said was 99.8% of the revised target for the period.
He added that the June 2026 target has been set at Rs1,727 billion, compared to Rs1,502 billion collected in June 2025, implying a required growth of around 15%, which he described as achievable under the revised fiscal framework.
Rejecting concerns about a widening fiscal gap, the adviser said there was no basis for claims of a revenue crisis or the need for extraordinary enforcement measures in the final month of the fiscal year.
He urged commentators and analysts to rely on updated official figures rather than earlier benchmarks, arguing that selective comparisons could create a misleading impression of economic stress.
Schehzad reiterated that once revised projections are taken into account, the narrative of a significant revenue shortfall does not reflect the country’s actual fiscal position.
