Islamabad, December 8, 2025 – Pakistan’s tax-to-GDP ratio is projected to reach 11% in the current fiscal year (FY26), Finance and Revenue Minister Muhammad Aurangzeb announced on Monday.
The minister highlighted strong revenue growth driven by structural reforms, digital monitoring, and stricter enforcement against tax evasion.
Record Federal Revenue Collections in FY25
Speaking in the National Assembly, Aurangzeb reported that federal revenue collection rose by 27% last fiscal year, reaching Rs11.7 trillion compared to Rs9.2 trillion in FY24. This increase, he noted, is unprecedented and not a one-off achievement. Key contributors included:
• Withholding tax: +28%
• Sales tax: +26%
• Federal excise duty: +33%
• Customs duty: +16%
“The overall performance is strong and structurally driven,” the minister said, adding that Pakistan’s tax-to-GDP ratio had improved from 8.5% to 10.3% and is expected to climb to 11% in FY26. He credited automation and technology-led reforms, monitored weekly by the Prime Minister, for sustained revenue growth.
Digital Monitoring and Enforcement Drive
Aurangzeb emphasized the government’s focus on widening the tax net and boosting compliance. This year, around Rs200 billion was collected from retailers and wholesalers, with 400,000 non-null returns filed, marking a significant compliance gain.
The minister highlighted digital production monitoring in key sectors, including sugar and cement, which generated Rs7 billion and Rs10 billion in additional collections between July and November. “These reforms will continue. Technology is the equaliser,” he stated, urging lawmakers to share intelligence on suspected tax evasion to further strengthen enforcement.
Sustaining Revenue Growth
Aurangzeb assured the National Assembly that the government remains committed to deepening tax compliance and modernizing revenue systems, ensuring Pakistan achieves fiscal stability and sustainable growth in the years ahead.