The federal Govt is preparing to present a mini-budget aimed at generating Rs50 billion. The funds will be used for flood rehabilitation and to address the widening tax shortfall.
Officials revealed that the plan includes new levies on luxury vehicles, imported electronic goods, and cigarettes. Duties that were cut in June may also be reinstated.
According to the Federal Board of Revenue (FBR), a five percent levy on imported electronic items is under consideration. The final price threshold for this tax has not been decided yet.
The mini-budget also proposes a levy on luxury vehicles with engines of 1,800cc or above. However, the Govt will need approval from the International Monetary Fund (IMF) before applying these taxes.
Another measure under review is a Rs50 levy on every pack of cigarettes. Unlike other tax revenues, this levy will not be shared with the provinces and will go directly to the federal government.
The urgency for the new budget stems from a significant shortfall in tax collection. In August, the FBR collected Rs901 billion against a target of Rs951 billion, leaving a gap of Rs50 billion.
Between July and August, collections dropped nearly Rs40 billion short of projections. Officials attributed the decline to floods, reduced gas and electricity usage, and weaker business activity.
The overall revenue target for FY2025 is Rs14,131 billion. The Govt hopes that the proposed mini-budget will help reduce the shortfall while also funding rehabilitation for flood-hit areas.
By introducing these measures, the government aims to strengthen revenue streams and ensure financial stability during a challenging economic period.
In other related news also read Govt Introduces Minor Revision in Petrol Prices
