Pakistan unveils budget targeting 4% GDP growth, tax breaks
Pakistan just rolled out a new budget aiming for 4% gross domestic product (GDP) growth in the next fiscal year, coming off its best economic run in four years.
Finance Minister Muhammad Aurangzeb is offering tax breaks for businesses, some relief for salaried folks, and the housing sector to keep things moving.
But with oil prices climbing and inflation sticking around, it's not going to be an easy ride.
Pakistan government seeks 2% primary surplus
To keep up with International Monetary Fund requirements (IMF), the government wants a primary surplus of 2% of GDP in fiscal 2027.
That means stricter revenue goals — like an 18% jump in tax collection (up to 15.3 trillion rupees).
But there's a trade-off: provincial development funding has been cut by 25%, which is causing delays and tension with provincial governments.
The upside? Fiscal discipline recently unlocked $1.3 billion from the IMF, helping rebuild foreign reserves, but Ahfaz Mustafa warned that housing sector tax breaks could push up imports and make balancing the books even trickier.