LAHORE: The Punjab government has announced plans to establish a single provincial tax authority modeled after the Federal Board of Revenue (FBR), bringing all provincial taxes under one umbrella to improve revenue collection, enhance compliance, and broaden the tax base.
Speaking at a post-budget press conference, Punjab Finance Minister Mian Mujtaba Shujaur Rehman said the new authority is expected to be launched during the upcoming fiscal year as part of the province’s broader tax reforms and digitization agenda.
Punjab Achieves 99% of Tax Collection Target
The finance minister revealed that Punjab successfully achieved 99 percent of its tax collection target during FY2025-26 and has now increased its revenue target for FY2026-27 by 46 percent.
He expressed confidence in meeting the ambitious goal, noting that Punjab’s own-source revenues are projected to grow between 30 and 40 percent during the next fiscal year.
According to the minister, the Punjab Revenue Authority (PRA) surpassed its annual target by collecting 30 percent more revenue than expected, while the Excise and Taxation Department recorded a 12 percent increase in collections.
For FY2026-27, the government has assigned:
- Punjab Revenue Authority (PRA): Rs. 528 billion
- Excise and Taxation Department: Rs. 124 billion
- Non-tax revenue departments: Rs. 461 billion
Property Tax System to Be Fully Digitized
Rehman said Punjab is accelerating the digital transformation of its tax administration. Following the successful online transition of excise and taxation collections, the government now plans to fully digitize the Board of Revenue’s collection system.
He added that the property tax regime is also being digitized to reduce corruption, improve transparency, and simplify tax payments for citizens and businesses.
The government is simultaneously strengthening the human resource capacity of the Punjab Revenue Authority to support its expanded responsibilities under the proposed unified tax framework.
Punjab Budget Impacted by Rs. 546 Billion Federal Grant
The finance minister noted that only minor adjustments have been made to existing provincial tax rates in the new budget. He explained that Punjab’s decision to provide a grant of Rs. 546 billion to the federal government reduced the province’s development budget from Rs. 1.24 trillion to Rs. 752 billion.
Despite the reduction, Rehman maintained that key development projects and public services would remain unaffected.
Government Rejects Claims of Neglecting South Punjab
Addressing concerns regarding regional development, provincial ministers rejected allegations that agriculture and South Punjab were being ignored in budget allocations.
Officials highlighted that 5,000 acres of a planned 5,500-acre aquaculture project are located in South Punjab, demonstrating the government’s commitment to the region.
The government also dismissed reports suggesting a Rs. 145 billion target for traffic fines, clarifying that the actual target stands at Rs. 45 billion.
Additionally, officials confirmed that PC-1 documents for 493 new development projects will be finalized by June 30, paving the way for their implementation in the upcoming fiscal year.
Major Tax Reform Planned for FY27
The proposed creation of a single FBR-style tax authority represents one of Punjab’s most significant tax reforms in recent years. By consolidating tax collection functions, enhancing digitization, and leveraging data-driven administration, the government aims to improve efficiency, increase revenue, and reduce tax evasion across the province.
