Aurangzeb calls for taxpayer trust, policy stability to encourage private investment

Add ARY News on GoogleFollow on Google Discoverimage: finance ministryAAResizeISLAMABAD: Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb on Tuesday pledged to restore public trust and credibility in the Federal Board of Revenue (FBR), stressing that taxpayer confidence, policy predictability and stronger enforcement were essential to building a modern and growth-friendly tax system.

Addressing a two-day high-level workshop titled “Reforms for a Modern and Growth-Friendly Tax System in Pakistan” in Islamabad, convened by the Ministry of Finance in collaboration with the International Monetary Fund (IMF), Aurangzeb said ongoing reforms had helped increase the FBR’s tax-to-GDP ratio from 8.8 per cent to 10.3 per cent.

He also highlighted a 40 per cent increase in tax revenues over the last two fiscal years, attributing the improvement to stronger enforcement and new policy measures.

Explaining the increase in the tax-to-GDP ratio, the finance minister said 0.9 percentage points of the 1.5-percentage-point rise came from enforcement measures, while the remaining 0.6 percentage points resulted from new policy initiatives.

“We stopped leakage, theft and corruption,” Aurangzeb said, adding that deeper enforcement would play an increasingly important role in the next phase of tax reforms.

He said the government was continuing to strengthen the tax system, broaden the tax base and improve revenue collection to support economic stability and sustainable growth.

Emphasising the need for a predictable business environment, Aurangzeb said the private sector required policy continuity to make long-term investment decisions.

“We cannot continue to give surprises to private-sector investment at every single budget,” he said, stressing that consistency in government policies was essential to encouraging investment.

The minister identified political consensus, stronger institutions and taxpayer trust as key enablers of sustainable tax reform. He also underscored the importance of cooperation between the federal and provincial governments in achieving broader agreement on tax policies.

“Bringing trust and credibility back into the tax authority” was among the most important priorities, he said, highlighting the need to improve the relationship between taxpayers and the tax administration.

The workshop brought together senior government officials, representatives of the IMF and the World Bank, international tax experts, academics and private-sector leaders to discuss priorities for modernising Pakistan’s tax system and strengthening its contribution to sustainable economic growth.

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The programme features six substantive sessions covering taxation and economic growth; modernisation of Pakistan’s tax system; a unified sales tax regime across the federation and provinces; a simpler and more neutral income tax system; tax administration, digitalisation and taxpayer trust; and fiscal federalism and provincial tax revenues.

Aurangzeb delivered the opening remarks alongside Jihad Azour, Director of the IMF’s Middle East and Central Asia Department, and Rodrigo Valdés, Director of the IMF’s Fiscal Affairs Department.

ISLAMABAD: Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb on Tuesday pledged to restore public trust and credibility in the Federal Board of Revenue (FBR), stressing that taxpayer confidence, policy predictability and stronger enforcement were essential to building a modern and growth-friendly tax system. Addressing a two-day high-level workshop titled “Reforms for a Modern […]