ISLAMABAD: The government granted tax exemptions worth more than Rs11 trillion over the past five fiscal years, with the Finance Ministry disclosing the figures in the National Assembly amid persistent fiscal pressures and efforts to broaden the tax base.
According to details presented by the Finance Ministry during the question hour in the National Assembly, tax exemptions amounted to Rs1,482.31 billion in fiscal year 2020-21, rising to Rs2,239 billion in 2021-22.
The figures showed that tax exemptions increased further to Rs2,540 billion in 2022-23 before standing at Rs2,434 billion in 2023-24 and Rs2,352 billion in 2024-25.
The five-year figures indicate that tax exemptions remained above Rs2 trillion annually in the last four fiscal years, highlighting the scale of revenue concessions granted through the taxation system.
The ministry’s breakdown showed that income tax exemptions amounted to Rs580 billion, while sales tax exemptions stood at Rs1,274 billion. Customs duty exemptions were reported at Rs499 billion.
The figures presented in the assembly provide a breakdown of selected tax exemptions, although the reported category-wise amounts do not, by themselves, establish the full composition of the more than Rs11 trillion granted over the five-year period.
Tax exemptions can be provided to support specific sectors, encourage investment, facilitate trade or achieve broader economic objectives. However, exemptions also represent potential revenue foregone by the government and remain an important consideration as Pakistan seeks to improve revenue collection and manage fiscal pressures.
The disclosure in parliament brings renewed attention to the scale of tax concessions and their role in the country’s overall revenue policy.