tax collection reaches Rs8.1 trillion and remittances cross $23 billion in fy26

Pakistan’s economy has shown early indications of recovery during the first eight months of FY2025–26, with federal tax receipts reaching approximately Rs8.1 trillion between July and February, compared with Rs7.3 trillion recorded during the corresponding period of the previous fiscal year, according to Planning Minister Ahsan Iqbal.

Government officials attributed the increase primarily to enhanced tax compliance, administrative improvements within the revenue system, and gradual expansion in overall economic activity.

Remittances from overseas Pakistanis also played a stabilising role in the economy. During July–January FY2026, remittance inflows amounted to approximately $23.2 billion, reflecting an 11.3 percent increase compared with $20.9 billion received during the same period last year.

The minister further noted that Large-Scale Manufacturing (LSM) recorded year-on-year growth of 4.8 percent during July–December FY2025–26. Out of 22 industrial sectors tracked, 14 posted positive performance, including automobiles which expanded by 67.2 percent, non-metallic mineral products by 10.5 percent, beverages by 5.4 percent, wearing apparel by 7.5 percent, food products by 0.6 percent, textiles by 1.5 percent and tobacco by 8.7 percent.

In terms of external trade, total exports of goods and services reached approximately $24 billion, while imports increased to $44.4 billion. The rise in imports was attributed to stronger domestic demand for intermediate and capital goods as well as tariff adjustments aimed at enhancing industrial competitiveness. Services exports recorded notable growth of 18.8 percent to reach $5.7 billion, supported by a 20 percent increase in information and communication technology exports. Meanwhile, services imports rose by 17.4 percent to $7.7 billion.

Addressing inflation trends, the minister stated that consumer price inflation in February 2026 rose to 7 percent compared with 1.5 percent recorded in the same month last year. The increase was largely attributed to base-year effects and adjustments in electricity tariffs. However, average inflation for the period July–February declined slightly to 5.5 percent compared with 5.9 percent in the corresponding period last year. Prices of several essential food items also declined, including eggs which fell by 22.4 percent, chicken by 20 percent and potatoes by 16 percent.

Iqbal cautioned that geopolitical tensions in the Middle East and volatility in global energy markets could pose inflationary risks domestically. He encouraged citizens to adopt responsible consumption patterns, including limiting unnecessary travel and reducing the number of vehicles used within households.

On the development front, public sector spending also progressed during the period under review. Approximately Rs585 billion was authorised for development expenditure, while Rs403 billion was formally sanctioned during July–February FY2025–26. Utilisation under the Public Sector Development Programme reached around 36 percent of the Rs1 trillion allocation, equivalent to Rs361 billion, compared with 20 percent or Rs312.3 billion during the same period last year.

The Central Development Working Party approved four development projects and recommended five additional projects to the Executive Committee of the National Economic Council for further consideration. These initiatives are expected to generate approximately 18,366 direct employment opportunities along with 7,320 indirect jobs. Cost rationalisation measures reportedly resulted in savings of around Rs9.9 billion, while continued monitoring was undertaken to improve implementation efficiency.

At the international level, Pakistan has initiated work on a five-year roadmap to strengthen economic cooperation with Kazakhstan following the Pakistan–Kazakhstan Strategic Partnership Joint Declaration. Discussions were also held with the Islamic Development Bank regarding the Member Country Partnership Strategy for 2026–2030, while engagements with Bangladesh focused on enhancing regional economic collaboration.

Concluding his remarks, the planning minister emphasised the need for collective national responsibility, stating that prudent consumption habits and public cooperation will remain critical to sustaining economic stability amid evolving global challenges.