ISLAMABAD: The federal government is weighing options to revise downward the Federal Board of Revenue’s (FBR) tax collection target by Rs300 billion to Rs500 billion for the current fiscal year, following missed privatisation deadlines and widespread flood-related losses.
The FBR’s annual revenue goal could be reduced from Rs14.13 trillion to between Rs13.7 trillion and Rs13.9 trillion, reflecting potential revisions to the macroeconomic framework.
Another option under consideration involves imposing a flood levy on high-net-worth sectors and individuals to generate funds for rehabilitation and reconstruction efforts.
Preliminary estimates of flood damage indicate major crops such as rice, sugarcane, and cotton could face losses of 15%, 5.7%, and 10%, respectively, while the livestock sector has also been affected. These setbacks are expected to lower real GDP growth from 4.2% to around 3%, while consumer price index-based inflation could rise from 5–7% to approximately 8%.
A senior official noted that FBR revenues may face shortfalls of Rs300 billion in the first half of the fiscal year (July–December), largely due to reduced purchasing power in the agriculture sector affecting sales tax collections.
Independent tax experts, however, warn that total revenue losses could approach Rs500 billion for the year. Authorities expect partial recovery in the second half (January–June) if remaining crops, such as wheat, perform better.
On the privatisation front, the government missed deadlines to sell Pakistan International Airlines (PIA) by August 2025 and First Women’s Bank and HBFC by May 2025. Work is underway on privatising three distribution companies (IESCO, FESCO, GEPCO), with sell-side due diligence and bidding targeted for December 2025.
The government is also planning the privatisation of ZTBL by year-end and intends to hire advisors for the second batch of DISCOs (HESCO, SEPCO, PESCO) by April 2025, though this has not yet been achieved.
Privatisation of generation companies (GENCOs) is also on the agenda, with bidding for Nandipur projected for January 2026. Meanwhile, the Roosevelt Hotel transaction structure is still being finalised.
Authorities aim to prioritise profitable state-owned enterprises (SOEs) to reduce the government’s commercial footprint and attract investment, alongside implementing structural reforms to restore the power sector’s viability.
