Revenue gap raises alarm as businesses seek reforms

The struggle of Pakistan's financial managers to achieve revenue targets for the current fiscal year has once again come under the spotlight, with early data pointing to a widening gap between projected collections and actual performance. The first quarter of fiscal year 2025-26 has already revealed a shortfall of nearly Rs200 billion, indicating deeper structural problems in the tax system at a time when the country remains under strict scrutiny from international lenders. The revenue target for the year requires a substantial 20.3% annual growth. However, the Federal Board of Revenue (FBR) has so far managed to achieve only 12.5% growth in the first quarter. This mismatch has prompted growing concerns among business leaders, who believe the government must urgently address flaws in the taxation framework before the gap becomes unmanageable.