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KARACHI, July 7,2026: Federal Minister for Finance and Revenue Muhammad Aurangzeb on Tuesday said Pakistan will introduce an AI-driven tax administration system that will issue tax notices with minimal human intervention. He also projected remittance inflows of $41-42 billion during the current fiscal year.
Speaking at the Pakistan Banking Summit 2026, Aurangzeb said Parliament has approved a new tax administration model that uses artificial intelligence and technology to improve transparency, efficiency and taxpayer services.
“The new system will issue notices through AI, reducing human intervention,” he said. He added that the government will soon unveil a medium-term tax strategy to strengthen tax administration.
The minister said Pakistan ended FY26 on a strong economic footing. The country posted a primary budget surplus, recorded its lowest fiscal deficit, reduced the debt-to-GDP ratio to below 70 percent and achieved 3.7 percent GDP growth, driven mainly by a rebound in large-scale manufacturing (LSM).
Meanwhile, he said the current account remained strong due to record remittance inflows. He expected remittances to reach $41-42 billion this fiscal year, while foreign exchange reserves are likely to close at around $18.4 billion, exceeding earlier projections.
On exports, Aurangzeb acknowledged a decline in overall shipments but said the slowdown was largely confined to food exports. In contrast, value-added exports, particularly textiles, continued to post year-on-year growth.
He also highlighted the government’s efforts to diversify funding sources. Pakistan is moving ahead with the Panda Bond, he said, describing it as a major step toward tapping China’s capital market.
Turning to the Pakistan Stock Exchange (PSX), Aurangzeb said rising investor participation matters more than index levels. He noted that the number of investors has increased sharply, especially among Gen Z, while corporate profitability has returned to double-digit growth.
Furthermore, he said the newly established Tax Policy Office led the preparation of the Federal Budget 2026-27 for the first time. The government also removed advance tax and super tax to support exports, while continuing tariff reforms and subsidized financing.
Aurangzeb stressed that the banking sector will play a critical role in Pakistan’s transition from economic stabilization to sustainable growth. He urged banks to expand lending to SMEs, exporters, agriculture, manufacturing, construction and the IT sector.
On privatization, he said Pakistan International Airlines (PIA) has successfully moved into private ownership. He added that roadshows for three power distribution companies (DISCOs) have concluded, while 28 state-owned enterprises have already been transferred to the Privatization Commission.
In conclusion, Aurangzeb appreciated the Pakistan Banks Association (PBA) for organizing the summit and invited industry stakeholders to share proposals for strengthening Pakistan’s financial sector.
