The federal government has told the visiting International Monetary Fund (IMF) review mission that the US-Iran conflict and disruption in the Strait of Hormuz resulted in an estimated Rs. 144 billion loss in Pakistan’s tax revenue during the first quarter of the current fiscal year.
According to government officials, the conflict pushed up fuel prices and weakened economic activity in Pakistan, affecting tax collection, particularly sales tax and withholding tax collected at the import stage.
Hormuz Disruption Hit Pakistan’s Revenue Collection
The government told the IMF that disruptions in the Strait of Hormuz affected Pakistan’s economy through higher fuel costs and slower economic activity.
The impact was reflected in tax revenues linked to imports, as increased fuel prices and weaker business activity reduced the amount collected through key tax channels.
The government’s assessment comes as the IMF mission reviews Pakistan’s fiscal position and evaluates the economic effects of the regional conflict.
FBR Maintains Rs. 3.053 Trillion Target
Despite the estimated revenue shortfall, the Federal Board of Revenue (FBR) has assured the IMF that it expects to achieve its first-quarter tax collection target of Rs. 3.053 trillion by September 30.
The assurance comes amid pressure on revenue collection from higher energy costs and weaker economic activity.
IMF Reviews Economic Impact of Conflict
The visiting IMF mission is continuing its assessment of Pakistan’s economic performance, including the impact of the US-Iran conflict and the disruption in the Strait of Hormuz.
The review is also examining Pakistan’s fiscal performance, tax collection and revenue position during the first quarter of the current fiscal year.
The government’s briefing highlights how developments outside Pakistan have affected domestic revenue collection through fuel prices, imports and broader economic activity.
