Islamabad, September 17, 2025: The federal government is preparing to introduce a mini-budget to raise at least Rs50 billion for flood rehabilitation efforts and to bridge a growing tax shortfall, officials confirmed on Wednesday.
The plan includes new levies on luxury items, imported electronic goods, and cigarettes. According to Federal Board of Revenue (FBR) officials, a five per cent levy on electronic goods is under review, though the price threshold has yet to be finalised. A special levy is also being considered for luxury vehicles with engines of 1,800cc and above.
In addition, the government is weighing the option of reinstating a levy equivalent to the regulatory duty that was reduced in June on certain imported products. Officials said that final approval from the International Monetary Fund (IMF) would be required before the new taxes can be implemented.
One of the most significant measures under discussion is a Rs50 levy on every pack of cigarettes. Unlike other revenue streams, this levy will go directly to the federal government without being shared with the provinces.
The urgency for the mini-budget stems from a revenue shortfall. In August, the FBR collected Rs901 billion against a target of Rs951 billion, leaving a Rs50bn gap. From July to August, collections fell nearly Rs40bn short of projections. The government’s overall revenue target for FY2025 stands at Rs14,131bn, but officials say widespread flooding, reduced electricity and gas consumption, and sluggish business activity have hampered revenue growth.
The proposed measures, officials added, are aimed at both providing immediate support for flood-affected populations and stabilising federal revenues in the wake of economic disruptions.
