Budget 2025–26: Higher Tax on Cash Withdrawals, Stricter Restrictions on Non-Filers Proposed

Islamabad – Key highlights of Pakistan’s federal budget for fiscal year 2025–26 have emerged, featuring tougher measures on non-filers, increased taxes on cash withdrawals, and a range of economic targets and development initiatives. The government is expected to present a Rs. 17,600 billion budget in Parliament today, following a special cabinet meeting scheduled for 4 PM at Parliament House.
Fiscal Targets and Revenue Goals
Expected total revenue: Rs. 19,300 billion
FBR’s revenue target: Rs. 14,130 billion
Provincial share under NFC Award: Rs. 8,300 billion (57% of federal revenue)
Budget deficit: Estimated at Rs. 6,500 billion
Interest payments on debt: Rs. 8,500 billion
Federal development spending (PSDP): Rs. 1,000 billion
Macroeconomic Targets
Current account deficit: $2.1 billion (0.5% of GDP)
Exports (goods): $35.3 billion
Imports (goods): $65.2 billion
Total exports (goods & services): $44.9 billion
Total imports (goods & services): $79.2 billion
Remittances target: $39.4 billion
Services exports: $9.6 billion
Services imports: $14 billion
Major Initiatives & Announcements
Rs. 250 million for 1,000 industrial stitching units
Laptop scheme & Pakistan-Bangladesh Friendship Scholarship Program
Electricity infrastructure upgrades in over 15,000 villages
Addition of 2,800 MW to national grid, including 2,633 MW through solar net metering
Progress on ML-1 and Karachi Circular Railway projects
Establishment of Arshad Nadeem / Shehbaz Sharif High-Performance Sports Academy
Special development programs for AJK, Gilgit-Baltistan, and merged districts
Taxation & Financial Policy Reforms
Tougher Restrictions on Non-Filers
Ban on non-filers from purchasing property and vehicles remains in place
Proposed ban on foreign travel for non-filers
Cash withdrawal tax from banks raised from 0.6% to 1.2% on withdrawals over Rs. 50,000
Non-filers barred from investing in stocks and mutual funds
Restrictions on large financial transactions for non-filers
Proposal to completely eliminate the non-filer category from the tax system
Other Tax Measures
Petroleum levy to be gradually increased from Rs. 78 to Rs. 100 per liter
Carbon levy of 2.5% proposed
Subsidy allocation: Rs. 1,186 billion
Additional duty reduction on over 3,500 imported items
Super Tax Adjustments
Profits of Rs. 200 million: Reduced from 1% to 0.5%
Profits of Rs. 250 million: 1.5%
Profits of Rs. 300 million: Remains at 4%
Measures Against Tax Evasion
Penalty on POS tax evasion proposed to be increased from Rs. 500,000 to Rs. 5 million
The budget reflects a focus on broadening the tax base, tightening compliance, and increasing development spending while aiming to reduce fiscal imbalances and manage rising debt levels.