PM Shehbaz Sharif secures major relief as IMF agrees to reconsider Key tax proposals

ISLAMABAD: In a major development ahead of the Federal Budget 2026-27, the International Monetary Fund (IMF) has reportedly agreed to withdraw proposed taxes on solar panels and stationery items following a request from the government.

Sources said the government successfully persuaded the IMF not to impose the proposed 18% sales tax on solar panels, with the tax rate likely to remain at 10% in the upcoming budget.

In another relief measure, the IMF has also shown willingness to drop the proposed 18% sales tax on stationery items, bringing good news for students and parents across the country.

Sources further indicated that no major changes are expected in taxes on the stock market and tobacco products, while discussions on taxation measures for the real estate sector remain inconclusive.

Negotiations between the government and the IMF are continuing on several budgetary proposals.

The government is also expected to announce a Rs60 billion relief package for salaried individuals. Under the proposal, the taxable income threshold may be increased from Rs4.1 million to Rs7 million, while the existing 10% surcharge on higher-income earners is likely to be abolished.

The current tax slabs for employees earning between Rs600,000 and Rs1.2 million annually are expected to remain unchanged.

Additionally, the budget is likely to include a special relief package aimed at boosting exports, with a proposal under consideration to abolish the 1% export tax.