Pakistan is preparing for tough negotiations with the International Monetary Fund (IMF) next week for the 2026-27 federal budget. Experts believe this budget may prove difficult for salaried people as the IMF is demanding strict new revenue measures and major spending cuts.
Reports say the IMF wants Pakistan to collect an extra Rs. 230 billion through new taxes. The fund is also pushing for a complete phase-out or sharp reduction in subsidies on fuel and electricity. Government spending on development projects may also face heavy restrictions to meet fiscal targets.
Salaried class employees are likely to be affected the most. The government is considering structural tax reforms that could increase the tax burden on fixed-income earners. Traders and retailers may also face new taxation rules. While some minor relief may be given in one area, it will likely be balanced by increasing taxes somewhere else.
Finance Ministry officials say they are trying to protect ordinary citizens, but meeting IMF conditions is necessary to continue receiving loans and avoid default.
This upcoming budget is expected to focus heavily on expanding the tax net and bringing more people into the tax system. However, many fear it will increase inflation and make life more expensive for middle-class families already struggling with high prices.
