Aurangzeb terms Tax Asaan Scheme for traders a ‘paradigm shift’

Finance Minister Muhammad Aurangzeb on Tuesday termed the launch of the Tax Asaan Scheme for traders a “paradigm shift”, adding that the government had to start somewhere in its efforts to widen the tax net.

In an interview on Geo News programme ‘Capital Talk’, Aurangzeb said: “We kept the tax rate at 1pc for traders because we have to start somewhere. However, it is part of a broader framework to expand the tax net, and we are moving in the right direction.”

The finance minister elaborated that he was working on a “new operating model” for tax collection with “no human intervention”.

He said that under the new scheme for traders, the discretionary powers of income tax officers would be limited.

“There will be a Central Processing Unit that will monitor everything. We have comprehensive data. We have compiled data from third-party sources and tax records, on the basis of which we are examining the issues,” the finance minister said.

He said the public had welcomed the budget and that the government’s goal was to accelerate economic growth.

“We imposed taxes in FY2024-25 and FY2025-26. However, we have not introduced any new taxes this year.”

He further said the government would instead focus on “enforcement and compliance”.

“We have a digital product monitoring system; we initiated this in the sugar sector,” Aurangzeb said. “Prime Minister Shehbaz Sharif asked us to implement it in the sugar sector because his family has businesses in the sector.”

“Now we are moving into beverages, textiles and other sectors.”

Upskilling freelancers

The finance czar said Pakistani freelancers, who provide coding services for $10 to $12 per hour, could earn up to $250 per hour through upskilling in blockchain technology.

“The Pakistani freelancing community, the third largest in the world, is earning $10 to $12 per hour for coding. Through upskilling or reskilling in blockchain technology, they can earn between $50 and $250 per hour.”

He said the issue needed to be viewed in the context of Web 3.0, artificial intelligence and cryptocurrency, as everything is built on blockchain technology.

Addressing confusion over whether cryptocurrency is legal in Pakistan, Aurangzeb said: “The government is turning cryptocurrency into a regulated activity and is moving towards tokenisation.”

US-Iran deal

The finance minister termed the recent signing of the United States-Iran deal a “welcome development”.

“It was a welcome development and a proud moment for Pakistan,” he said, adding, “It was also a great moment for the global economy.”

Aurangzeb said the deal had also instilled a “positive sentiment” in global markets.

Responding to a question about the possible impact of the deal on the country’s economy, he said global oil prices had fallen to $80 per barrel and that the government had been trying to pass on the benefits for the past three weeks.

Aurangzeb said the public would be provided relief and the economy would see an upside, adding: “We will definitely see an upside; however, we cannot quantify it.”

When asked about the prospects of a US-Iran deal and the lifting of trade sanctions on Iran, he said: “It would be premature to say anything about it. We will have to wait until Friday, when the details of the agreement are unveiled.”

However, he said that if sanctions on Iran were lifted, Pakistan would “move with speed on that front” to strengthen its economy.

The finance czar added that Pakistan was also in constant discussions with the US on the prospects of expanding the partnership following the deal.

“For the next fiscal year, GDP will grow by 4pc and inflation will be 7.5pc,” the finance minister said.

Meanwhile, he acknowledged that the closure of the Afghanistan border had affected exports and the country’s strategy of export-led growth.

“We can see a huge upside here as well; however, the Taliban government has to act responsibly,” he said.

PPP, opposition reservations

When asked about a PPP lawmaker’s claim that details of the budget had been concealed before its presentation, he rejected the allegation, saying: “All the details were finalised through consensus on each and every point. There is nothing to hide.”

He added that the government was still ready to provide further details if needed and remained open to additional questions.

Responding to concerns about rising debt and allegations that the government had failed to address the issue effectively, Aurangzeb said: “We need to look at this in relation to our GDP. Our debt-to-GDP ratio has fallen to 70pc. We are moving in the right direction. Our external debt has now come down to $96 billion or $97bn.”

He said that around 40pc to 45pc of the amount had been borrowed from international lenders, while the remainder had come from friendly countries such as China and others.

Aurangzeb added that the Roshan Digital Account had surpassed $300 million in investments by overseas Pakistanis in May.

“It is a good sign; people are seeing something positive, they are witnessing improvement; there is a reason behind their trust.”

For poverty, he said, the government had increased the funds for the Benazir Income Support Programme to Rs838 billion.

“Tax revenues have been doubled from 7 trillion in 2025 to 13 trillion in 2026; has it ever happened in history?” he said.

KP budget

Replying to a question about the Khyber Pakhtunkhwa government’s demand that any contribution to the Centre be made through cuts in development spending and subject to the approval of PTI founder Imran Khan, Aurangzeb said: “In principle, they have no issue with it.”

“I had a very good meeting with Chief Minister Sohail Afridi and KP Adviser on Finance Muzammil Aslam,” Aurangzeb said, adding, “All provinces, including KP, have significantly supported us throughout the IMF programme.”

“Only the prime minister can make a decision on this demand,” he said.

Last week, Aurangzeb presented the FY2026-27 budget in the National Assembly (NA) with an outlay of Rs18.8 trillion, of which Rs8,045bn will be set aside for markup payments.

The finance minister said the economy was expected to grow 4 per cent in FY2026-27, and average inflation was expected to be recorded at 8.2pc.