According to the most recent economic study, Pakistan’s tax deductions for different sectors cost the nation over$ 21 billion this season, more than the$ 17 billion it needs to recover in diplomatic and commercial loan. The Economic Survey of Pakistan 2024-25, which details several economical developments and measures for the fiscal year, was presented on Monday by Pakistan’s finance minister Muhammad Aurangzeb. According to the study, tax deduction costs increased to Rs 5.8 trillion in the fiscal year 2024-2025, showing a significant increase of Rs 2 trillion from the previous month’s Rs 3.9 trillion under the present state, according to news organization PTI. Despite the removal of a number of exemptions from the Pakistan Muslim League-Nawaz ( PML-N) government’s previous budget, the survey revealed a Rs 1. 96 trillion, or 51 % increase in tax expenditure. According to the financial study, tax breaks and exemptions keep rising each year despite numerous attempts to lower them. These long-term deductions are protected by three distinct tax rules. Sales tax exemptions increased by 50 % from Rs 2.9 trillion in the prior fiscal year to Rs 4.3 trillion in the current one. Income tax exemptions increased by 68 % to Rs 801 billion from Rs 477 billion, while the government maintained exemptions for other industries like retailers. According to the report, the number of conventions work deductions increased by Rs 243 billion or 45 % to Rs 786 billion this fiscal year from Rupees 543 billion. The Rs. 5 trillion in” income expenses for 2025″ raises doubts about the accuracy of earlier reported losses, it continued. The government’s efforts to reduce tax expenditures have continued to grow, which suggests either the execution of many unknown tax exemptions or the underreporting of prior figures. According to the review, there is no significant reason for the dramatic increase in tax deduction fees.
