Pakistan, Aug. 6 -- Pakistan's tax-to-GDP ratio climbed to 15.7% in fiscal year 2025, marking the highest level in 21 years. This major increase of 3.2 percentage points came mainly due to strict taxation under the IMF program and last-minute gains from non-tax revenue. Previously, the ratio hovered between 10% and 15%, except during similar IMF-backed periods in 2016, 2017, and 2019.

The Ministry of Finance reported a 68% rise in non-tax revenue, which outpaced the 26% growth in tax revenue. This shift indicates the government's focus on overall revenue collection instead of deep tax reforms. The 15.7% ratio also reflects the biggest one-year jump ever recorded, surpassing the 2.3% rise seen in 2020 under an earlier IMF program.

Non-ta...