The federal government is gearing up to introduce a Pakistan mini budget 2025 to raise at least Rs50 billion, aiming to support flood rehabilitation efforts and bridge a growing tax shortfall.

New taxes under consideration

Officials confirmed that additional levies on luxury items, cigarettes, and imported electronic goods are under review. The proposed measures include:

• A five per cent levy on imported electronic goods (price threshold yet to be finalized).

• A levy on luxury cars with engines above 1,800cc, pending IMF approval.

• A Rs50 tax on each cigarette pack, with revenue going directly to the federal government instead of being shared with provinces.

The government is also considering reinstating certain regulatory duties on imported products that had been reduced in June.

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The urgency for the Pakistan mini budget 2025 stems from a widening gap in tax revenue collection. According to the Federal Board of Revenue (FBR), only Rs901 billion was collected in August against the Rs951bn target, creating a Rs50bn shortfall.

From July to August, tax revenues were nearly Rs40bn below projections. With the ambitious annual target set at Rs14,131bn for FY2025, officials blame heavy floods, declining energy consumption, and sluggish business activity for the slowdown.

Government insiders say the mini-budget is designed to strike a balance between raising funds for flood rehabilitation and meeting IMF-backed revenue targets. However, new taxes on everyday items like cigarettes and electronics could add to public frustration already fueled by inflation and rising living costs.