PM Emphasizes Expanding Tax Base and Easing Burden on Poor

On July 14, 2025, Pakistan’s Prime Minister Muhammad Shehbaz Sharif announced that broadening the tax base and reducing the tax burden on low-income citizens are top government priorities. He made this statement during a meeting on Federal Board of Revenue (FBR) reforms held in Islamabad. The initiative, centered on digitization and transparency, aims to create a fairer tax system while promoting economic stability.

Chairing a review of the FBR’s digitization efforts, Sharif highlighted the introduction of simplified tax returns in Urdu and called for a dedicated helpline to assist taxpayers. “Tax reforms must prioritize the common man’s convenience,” he said, according to Pakistan Today. The government is incorporating Artificial Intelligence (AI) in tax assessments, a development Sharif praised as a historic achievement, commending Finance Minister Muhammad Aurangzeb and FBR Chairman Rashid Mahmood Langrial. The reforms include digital invoicing, a taxpayer portal, and a monitoring dashboard. Businesses can register for free through Pakistan Revenue Automation Ltd. (PRAL). Training programs for traders and a centralized Command and Control Unit, expected to launch by September, will further improve efficiency, as reported by the Associated Press of Pakistan.

Sharif emphasized special support for small and medium enterprises (SMEs) to adopt digital invoicing, with plans to expand digital payment points from 500,000 to two million. Pakistan is collaborating with Turkey to align with international standards, with a Turkish delegation assisting in implementation, according to Radio Pakistan. The reforms also promote transparency through third-party validation. Pakistan’s tax-to-GDP ratio stands at 10.3%, significantly lower than the South Asian average of approximately 19%, per data from the Institute of Development Studies.

However, critics, including the Policy Research and Advisory Council (PRAC), argue that the reforms do not sufficiently address challenges faced by the industrial sector, raising concerns about potential risks to economic stability.

While Australia’s Labor government faces unrelated domestic scrutiny, Pakistan’s tax reforms demonstrate a commitment to economic justice and self-reliance. By easing the tax burden on low-income citizens and digitizing tax administration, Pakistan aims to strengthen its economy and ensure stability in the Indo-Pacific region through equitable governance.