Islamabad (TDI): Pakistan’s Finance Minister, Muhammad Aurangzeb, has said that reducing import duties and reforming the tariff structure are essential steps towards making Pakistan’s economy export-oriented. He made the remarks during a post-budget press conference while defending the fiscal strategy outlined in the federal budget for FY2025-26.
The minister said custom duties on four items have been abolished and rates reduced on 2,700 tariff lines; mainly raw materials for export sectors. He acknowledged potential revenue loss but said it was necessary for long-term growth, calling it part of Pakistan’s “East Asia moment.”
Aurangzeb was joined by FBR Chairman Rashid Mahmood Langrial and Finance Secretary Imdadullah Bosal, after journalists initially walked out due to the absence of a technical briefing. He expressed regret and said the government would hold regular briefings to improve communication.
On salary and pension increases, he said they were made in view of inflation, and are in line with global norms. Responding to concerns about the Rs37,000 minimum wage, he urged businesses and stakeholders to engage in dialogue rather than react emotionally.
Read More: Pakistan’s Budget FY 2025-26: Highest Tax Target, Relief for Low-Grade Employees
The minister announced a 0.5% reduction in super tax for corporations and incentives for property buyers to help revive the sector. He also highlighted the importance of mortgage finance in stabilizing the economy.
Regarding agriculture, Aurangzeb said the proposed tax on fertilizers and pesticides was dropped after discussions with the IMF. He admitted previous tax enforcement had been weak but stressed that the Rs2.2 trillion target relies largely on improved compliance, not just new taxes.
He called for reducing the role of middlemen in agriculture and providing credit to small farmers. On concerns about rising government expenditure, he claimed it had only increased by 1.9% and noted cuts in subsidies and debt servicing.
When asked about recent pay raises for top parliamentary officials, he said adjustments were overdue since 2016. He assured that broader reforms, such as the NFC award, would be based on consensus with provinces.
Aurangzeb concluded by stating that the budget reflects a shift toward structural reforms aimed at reducing the burden on the salaried class, increasing documentation, and addressing long-standing economic imbalances.
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