ISLAMABAD: Prime Minister Muhammad Shehbaz Sharif on Wednesday chaired a high-level review meeting on the ongoing reforms in the Federal Board of Revenue (FBR), lauding the progress made so far while stressing the need for sustained and time-bound efforts to overhaul the tax system in line with modern requirements.
Terming the recent improvements in the tax machinery as “encouraging,” the prime minister emphasized that reforms must lead to the creation of a sustainable, digitized, and facilitative tax system, a Prime Minister’s Office news release said.
“We have achieved important milestones, but more dedicated efforts are required,” he said.
The prime minister directed the FBR to accelerate digital transformation, restructure its digital wing with a clear roadmap, and enhance enforcement to curb the informal economy. He also stressed the importance of stakeholder consultation in the reform process, particularly with businesses, traders, and taxpayers.
He reiterated that improving the tax system should contribute to boosting national revenue while reducing the tax burden on the common citizen.
The meeting was briefed that as a result of the reforms and enforcement measures, the tax-to-GDP ratio saw a historic rise of 1.5% in FY2025 compared to FY2024. Moreover, the number of income tax return filers surged from 4.5 million in 2024 to over 7.2 million by June 30, 2025.
FBR officials reported significant progress under the faceless customs clearance system, which increased revenue and is expected to reduce clearance times from 52 hours to just 12 hours within the next three months.
In the retail sector, tax collection increased by Rs. 455 billion compared to the previous year, driven by the integration of point-of-sale systems and stricter enforcement.
The meeting was also informed that reforms had led to a 2.16% reduction in the weighted average tariff on imports, thereby lowering raw material costs and benefiting local industries.
To enhance the transparency of the faceless system, a new mechanism has been introduced, enabling case hearings through video link for timely resolution.
The Prime Minister welcomed proposals for further reforms and directed officials to submit a time-bound plan with actionable targets by next week. He also appreciated the efforts of FBR officials and officers involved in the reform process.
Federal Ministers Attaullah Tarar, Ahad Cheema, Azam Nazeer Tarar, Chairman FBR, and senior officials were present during the meeting.
