Parliament’s Finance Committees Express Concern Over Ambitious FY 2026-27 Revenue Targets

The Finance and Revenue committees from both the Senate and National Assembly voiced their apprehensions over the government’s revenue targets for fiscal year 2026-27. The FBR aims to collect Rs15.26 trillion in FY27, a rise of more than 8% from the proposed Rs14.13 trillion for FY26. However, the FBR collected only around Rs13 trillion in FY26.

NA Finance Committee Chairman Syed Naveed Qamar expressed concern over the Federal Budget’s focus on revenue generation and fiscal consolidation without offering much to stimulate economic growth or employment. He questioned the rationale of imposing additional taxation while maintaining large primary surpluses under IMF programme requirements.

The committee also noted that debt servicing continues to consume the largest share of current expenditure, exceeding Rs8 trillion. They called for a comprehensive debt management strategy to reduce borrowing costs and create fiscal space for development.

Concerns were raised about the heavy reliance on enforcement measures rather than broadening the tax base through meaningful structural reforms. The newly proposed retailer tax scheme was particularly criticized as it could create distortions within the tax system, discourage compliance under the normal tax regime, and potentially erode the existing tax base.

The Senate Standing Committee on Finance and Revenue met separately where FBR officials informed members that the prime minister had established a Tax Policy Office to separate tax policy formulation from tax administration. The committee approved a proposal to outsource the auction of seized goods to the private sector.

Finance Minister Muhammad Aurangzeb described the Tax Policy Office as a major structural reform, stating investors required predictability and consistency in government policy. Economic consultations would continue throughout the year rather than concluding on June 30.