Islamabad:
The Federal Board of Revenue (FBR) seems to have failed to achieve its revenue
targets once again. The revenue shortfall during the first eleven months (July
to May) of the fiscal year 2025-26 has increased to Rs868 billion, raising
serious questions about the institution’s performance and the government’s
fiscal strategy.
According
to official data, the FBR collected only Rs11,227 billion against the revised
target of Rs12,095 billion, resulting in a huge deficit of Rs868 billion. The
situation did not improve in May 2026 either, and the revenue deficit reached
Rs184 billion. The target set was Rs1,150 billion, but the collections remained
at just Rs966 billion.
FBR
officials are blaming the failure on tensions in the Gulf region, a slowdown in
economic activity, and the long Eid holidays. Still, critics say these
arguments are an attempt to hide the agency’s own administrative weaknesses, its
failure to expand the tax net, and its failure to curb large-scale tax evasion.
Experts
say that if the Gulf War and holidays are the only reasons for the decline in
revenue, then the question arises as to what steps the FBR took during the year
to increase the tax base and effectively bring retail, wholesale, property,
agricultural income and other low-tax sectors into the tax net? The fact is
that this time too, like every year, after failing to achieve the target, the
path is being paved to impose more taxes on the public by taking the easy way
out.
The
parliament had approved a target of Rs 14,130 billion for the FBR in the last
budget, which was later reduced to Rs 13,979 billion in consultation with the
IMF. Yet the institution is heading towards a deficit of nearly Rs1 trillion,
which not only reveals the weakness of the revenue system but also exposes the
reality of the government’s economic claims.
Now,
the FBR needs an extraordinary collection of Rs2,752 billion by June 2026 to
meet the annual target, which seems extremely difficult, if not impossible, to
financial experts. If the agency even reaches Rs13,000 billion by the end of
June, it is being called a success, although this will be significantly lower
than both the original and revised targets.
According
to analysts, the real problem is not the lack of revenue but the structural
flaws of the tax system. The consequences of not meeting the targets every year
are borne by the salaried class, consumers and middle-income citizens in the
form of higher taxes, additional levies, expensive electricity, gas and
petroleum products, while the influential and privileged classes remain largely
outside the grip of the tax system.
In
such a situation, the question becomes even more important: how long will the
FBR continue to blame its failures on external conditions, holidays or economic
slowdown, and when will it take effective measures against tax evasion,
corruption, smuggling and weak enforcement and move towards real tax reforms?
The people of Pakistan are already facing inflation and economic pressure, in
such a situation, putting the entire burden of not meeting revenue targets on
their shoulders again may not only be unfair but also economically harmful.
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