Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial has rejected the need for any emergency tax measures despite a revenue shortfall of Rs275 billion during the first four months (July–October) of the 2025–26 fiscal year.
Speaking during a briefing on economic reforms at the FBR headquarters, the chairman acknowledged the Rs275 billion deficit but made it clear that no additional emergency taxes would be introduced this year. He reminded that even last year, the commitment to avoid abrupt tax impositions was fulfilled, and the same approach will continue in the current fiscal cycle.
Rashid Langrial stated that there is no immediate requirement for introducing new taxes; however, improving tax compliance and expanding the tax base are essential for sustainable revenue growth. He revealed that tax payments and compliance have improved significantly this year. According to him, the number of income tax return filers has increased by 18%, reaching 5.9 million, though the total tax paid with these returns amounted to Rs69 billion for 2024–25.
He noted that the number of tax filers has grown from 4.9 million to 5.9 million, and the FBR has had its reform program approved since last November. For the first time, FBR has increased the tax-to-GDP ratio by 1.5%, which he attributed to institutional coordination and improved compliance strategies.
The chairman stated that FBR’s tax-to-GDP ratio rose from 8.83% in 2023–24 to 10.33% in 2024–25—the highest increase in 23 years. The ratio grew by 1.49 percentage points in just one year.
Langrial emphasized the goal of raising the federal–provincial revenue share to 18%, with 15% contributed by the federation and 3% by the provinces. He said the revenue pressure on provinces remains relatively low, while individual taxpayer filings have risen by 18% this year. The government aims to increase the tax-to-GDP ratio to 18% over the next three to four years with provincial cooperation.
He also highlighted that FBR enforcement teams have faced threats and attacks during operations, including the martyrdom of two officials near the Kohat Tunnel. He stressed that FBR’s purpose is not confrontation but implementation of tax laws. With support from Rangers and other agencies, enforcement actions have become more secure and effective.
According to Langrial, comprehensive policy reforms within FBR have increased the institution’s revenue share from 8.36% to 10.33%. He added that the income tax gap stands at approximately Rs1.7 trillion—of which Rs1.2 trillion relates to the wealthiest segment of society, while around Rs200 billion is linked to other taxpayers. More than 160 Rangers personnel are currently assisting with enforcement operations.
The chairman reiterated that FBR has been insulated from political and administrative interference and is now focused on expanding the revenue base to help stabilize the national economy. He said tax collection from the tobacco sector has increased significantly, and multiple structural initiatives are underway. The government remains fully committed to broadening and deepening the tax net to maximize revenue generation.
