Finance Minister Muhammad Aurangzeb on Monday announced a sweeping package of economic reforms aimed at securing long-term economic stability through structural changes in the tax, energy, and pension sectors.
Speaking at a press conference in Islamabad alongside FBR Chairman Rashid Mahmood Langrial, Energy Minister Owais Leghari, and IT Minister Shaza Fatima, the finance minister said the country has moved beyond short-term fixes to a sustainable reform framework.
“Economic stability has been achieved in the country. We have done important work related to macroeconomic stability, and our goal is to ensure sustainable economic stability. Reforms are indispensable for this purpose,” Aurangzeb stated.
He highlighted that international credit rating agencies have recognized Pakistan’s improving outlook, while the recent staff-level agreement with the IMF has further validated the progress. The government, he said, is now focusing on institutional reforms to enhance efficiency, “right-size” departments, and reduce wastage of public resources — all part of the broader vision for long-term economic stability.
‘FBR does not need to impose more taxes’
FBR Chairman Rashid Mahmood Langrial shared encouraging updates on Pakistan’s tax performance, revealing that income tax returns have risen by 18%, bringing the total number of taxpayers to 5.9 million.
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He said that the FBR has successfully increased the tax-to-GDP ratio by 1.5% — a first for Pakistan — through stronger compliance and coordination with various institutions. “The rate of submission of individual tax returns has increased. The FBR does not need to impose more taxes,” Langrial assured.
The government aims to push the tax-to-GDP ratio to 18% over the next three to four years, with federal and provincial contributions aligned toward this goal. Langrial also acknowledged the challenges faced by tax teams in the field, mentioning incidents where officials were attacked during enforcement drives. “Two of our people were martyred in the Kohat tunnel,” he said, noting that enhanced security cooperation with Rangers has made operations safer and more effective.
Power purchasing business
Energy Minister Owais Leghari unveiled what he described as “the biggest energy reform in 20 years” — the government’s plan to step back from directly buying electricity.
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“We inherited very expensive electricity, but despite challenges, we reduced prices by Rs10.5 per unit in the past 18 months,” Leghari said. He highlighted relief packages for industries, including a three-month offer of power at Rs26 per unit, and a major rate cut for electric vehicles — from Rs71 to Rs39 per unit.
The minister said the energy sector is being restructured on modern lines, with Rs48 billion saved through the auction of loss-making plants. “We auctioned 17 units — Rs48 billion were taken by a government agency and Rs9 billion by the private sector,” he added.
Leghari also announced that a comprehensive plan has been finalized to eliminate the Rs1.2 trillion circular debt within six years — without burdening consumers.
“In one year alone, we reduced circular debt by Rs700 billion by improving governance and cutting losses in distribution companies,” he said. The government also managed to slash Rs193 billion in losses, including Rs80 billion recovered from non-paying tube well owners in the Quetta Electric Company’s network.
