Decrease in Tax Revenue; Government Informs IMF of Budget Adjustments

Islamabad: Due to a decline in non-tax revenue, the government has informed the International Monetary Fund (IMF) of significant changes in budgetary targets. According to sources, the government has made substantial revisions to its new budget objectives. Adjustments were necessitated by a reduction in non-tax revenue, prompting the government to notify the IMF of these developments.
The current fiscal year’s budget deficit is feared to widen by Rs. 1.258 trillion. Estimates indicate the deficit target has increased from Rs. 8.5 trillion to Rs. 9.758 trillion. Similarly, in a scenario with a provincial surplus of Rs. 1.217 trillion, the deficit could reach Rs. 8.541 trillion.
The Ministry of Finance has stated that local and foreign loans will be utilized to cover the deficit. Government revenue is estimated to remain below expectations at Rs. 9.119 trillion, down from Rs. 10.377 trillion. Non-tax revenue targets have been revised downward from Rs. 4.845 trillion to Rs. 3.587 trillion.
State bank profits are expected to remain limited, not exceeding Rs. 1.258 trillion instead of the earlier projected Rs. 2.5 trillion. The Ministry of Finance has projected petroleum development levy collections at Rs. 1.281 trillion.
The current fiscal year is estimated to see an increase in government loans by Rs. 8.489 trillion. Public debt is expected to rise to Rs. 79.731 trillion, with a debt-to-GDP ratio maintaining at 64 percent.
These developments highlight the government’s efforts to manage fiscal challenges amid economic uncertainties.