Karachi, February 24, 2025 – Finance Minister Muhammad Aurangzeb has emphasized that tax policy formulation should not be confined solely to mathematical calculations but must also consider the broader economic value.
He stated that the Ministry of Finance is actively engaged in shaping tax policies that support sustainable economic growth and long-term development.
Aurangzeb categorically affirmed the government’s commitment to introducing necessary economic reforms, asserting that there would be no compromise on the reform agenda. “Pakistan needs to transform the DNA of its economy and move towards sustainable and inclusive growth,” he emphasized, underlining the importance of structural changes for long-term economic resilience.
Speaking at the inaugural session of the two-day Pakistan Banking Summit 2025, Aurangzeb reiterated that every sector must contribute to efforts for export-led growth. The summit, organized by the Pakistan Banks Association (PBA), aims to foster collaboration among industry leaders and integrate Pakistan’s banking sector into the global financial framework.
The finance minister highlighted that the government has taken challenging but necessary decisions, leading to macroeconomic stability. He pointed to improvements in key economic indicators such as the current account balance, inflation, and stock market performance as signs of progress. He stressed that ongoing reforms in fiscal policy, Federal Board of Revenue (FBR) governance, and restructuring of public sector entities were crucial steps toward economic stability.
Aurangzeb praised provincial governments for enacting legislation on agricultural income tax, calling it a landmark structural reform. He further elaborated on the government’s efforts to relaunch the privatization process of Pakistan International Airlines (PIA) and implement measures to reduce federal expenditures. A dedicated cabinet committee is currently reviewing rightsizing initiatives in a phased approach.
He also identified population growth and climate change as major challenges affecting Pakistan’s economic resilience. He revealed that Pakistan is collaborating with the World Bank to develop a 10-year country partnership focused on tackling these pressing issues along with fiscal discipline.
The finance minister announced that budget consultations for the upcoming fiscal year have commenced early to ensure input from all stakeholders. He invited the business and industrial communities to participate in the finance ministry’s advisory board to strengthen policy-making through collective insights.
Aurangzeb emphasized the banking sector’s crucial role in economic growth and formalization, urging banks to enhance financing for SMEs, agriculture, and other priority sectors. He lauded the PBA’s initiative in organizing the banking summit, expressing confidence that it would serve as an inclusive platform for addressing industry challenges and solutions.
Responding to media inquiries, Aurangzeb disclosed that an International Monetary Fund (IMF) team is arriving today to review climate finance measures, while another IMF delegation will visit Pakistan in early March for a half-yearly review of economic progress.
Earlier, PBA Chairman and CEO of Bank of Punjab, Zafar Masud, highlighted the banking sector’s role as the largest tax collector for the FBR and its contributions as the highest tax-paying sector. He also discussed improvements in financial inclusion, digital banking, and the restructuring plan for PIA.
Masud emphasized the need to transition the agriculture and SME sectors into the formal economy, which would expand their access to banking and financial opportunities. He reaffirmed the banking sector’s commitment to driving economic growth and facilitating Pakistan’s financial transformation.
