ISLAMABAD, November 3, 2026: The International Monetary Fund (IMF) has expressed concern over Pakistan’s widening tax revenue shortfall and proposed emergency taxation measures to address collection gaps, according to sources familiar with the discussions.
The IMF has reportedly raised concerns over a Rs129 billion tax collection shortfall in October and a cumulative revenue gap of Rs96 billion during the first four months of the current fiscal year.
The global lender has urged Pakistan to meet its annual tax collection target of Rs15.264 trillion, describing existing revenue mobilisation efforts as insufficient and calling for an increase in the country’s tax-to-GDP ratio.
According to Federal Board of Revenue (FBR) sources, additional taxation measures or reductions in government expenditure could be considered if the revenue shortfall continues to increase.
The possibility of tighter revenue-related conditions during upcoming economic reviews has also emerged, with emergency tax measures potentially becoming part of discussions if collection targets remain unmet.
Sources said the IMF has emphasised the need to increase general sales tax revenue at both federal and provincial levels to strengthen overall tax collection.
The lender could also introduce stricter revenue requirements for the next fiscal year, placing additional pressure on authorities to improve tax compliance and expand the tax base.
Before the next federal budget, Pakistan has reportedly been advised to demonstrate progress in collecting taxes from the retail, wholesale and agricultural sectors.
The IMF has also called for bringing professionals and other currently untaxed sectors into the formal tax system to improve revenue generation and reduce dependence on existing taxpayers.
The proposed measures could have implications for consumers and businesses if authorities decide to introduce additional taxes to compensate for lower-than-expected collections.
Sources indicated that meeting the conditions agreed under Pakistan’s $7 billion IMF loan programme remains essential, making revenue performance a key consideration in future economic assessments.
The developments come as the government faces pressure to improve tax collection while maintaining fiscal discipline and meeting commitments under the IMF-supported programme.