Budget 2025-26: FBR under fire over smuggling, graft allegations
• NA set to pass federal budget today with amendments
• Omar Ayub labels budget ‘dead on arrival’, slams inflation claims
• Rs4.8tr in grants approved for four ministries
• Finance minister claims macroeconomic stability restored
ISLAMABAD: The Federal Board of Revenue (FBR) came under fire in the National Assembly on Wednesday over allegations of collusion with smugglers and tax evaders, as the House paved the way for the federal budget’s passage today (Thursday).
The budget, presented on June 10, is now set to pass with previously agreed-upon amendments.
On Wednesday, the National Assembly completed the process of approving demands for grants to cover the expenses of various ministries and divisions.
It approved 31 demands for grants totalling Rs4.814 trillion for four ministries and divisions —Finance and Revenue, Human Rights, Interior, and National Food Security — while rejecting all 430 cut motions submitted by the opposition.
Leader of the Opposition Omar Ayub Khan, speaking during the debate on budgetary allocations for the Finance Division, alleged that oil worth Rs550 billion is smuggled from Iran every year.
He wondered how around 200 heavy vehicles manage to cross more than two dozen bridges daily without being intercepted, implying official complicity. Describing the FBR as “one of the most corrupt institutions”, he opposed proposals to grant it arrest powers.
He rejected the budget as “dead on arrival” and dismissed government claims of reducing inflation. He said the purchasing power of the masses continues to shrink and lamented that 44 per cent of citizens had slipped below the poverty line.
He accused the government of signing flawed power purchase agreements with independent power producers (IPPs) between 2013 and 2018, saying capacity payments had soared from Rs450bn in 2018 to Rs 2.2tr.
“This regime is responsible,” he said, adding that 97pc of the fiscal deficit would be financed through bank borrowing, benefiting the owners of four private banks.
JUI-F’s Aliya Kamran voiced alarm over the ballooning national debt, noting it had swelled to Rs76tr by March — more than four times the entire budget. On tax evasion, she said the FBR’s system was weak and lacked accountability. “Tax frauds are made with the help of FBR officials,” she alleged.
PTI’s Usama Ahmad Mela criticised the government’s reliance on indirect taxes, including the imposition of a carbon tax amid rising oil prices, instead of reducing the petroleum levy. He questioned the rationale behind taxing hybrid vehicles if the state was serious about promoting eco-friendly alternatives and demanded the reversal of the decision.
He also condemned the government’s policy of exporting and then re-importing 750,000 tonnes of sugar, saying it had led to a Rs50 per kilogram price hike. “If we continue surrendering to pressure groups and lobbies, we should forget about public relief,” he said.
He warned that allowing the FBR to make unlimited contract-based recruitments and leaving small business owners at its mercy would open floodgates of corruption.
JUI-P’s Shahida Begum criticised the FBR’s inaction in the face of disclosures about public officials owning large, undeclared properties, and opposed proposed powers allowing it to arrest businessmen.
PTI’s Shandana Gulzar challenged government claims of growth in the livestock sector, pointing out that the last livestock census was held in 2006. She accused the government of peddling falsehoods and pursuing anti-people policies, adding: “We are sowing the seeds of revolution in Pakistan.”
‘Macroeconomic stability’
Winding up the discussion on cut motions on demands for grants relating to the Finance and Revenue Division, Finance Minister Muhammad Aurangzeb claimed that macroeconomic stability had been restored.
He cited improvements in economic indicators, including a stable currency, increased foreign reserves sufficient to cover two and a half months of imports, and reduced inflation and policy rates. “These are hard facts, independently validated by rating agencies,” he said. He said investor, business and consumer confidence had improved over the past four to five months, citing a Dun & Bradstreet survey indicating the highest consumer confidence since 2022.
On FBR corruption, he said digitisation was meant to ensure transparency and minimise human involvement, which he called the most effective way to reduce graft.
Concluding debate on cut motions related to the Human Rights Division, Minister Azam Nazeer Tarar highlighted that the National Commission for Human Rights Pakistan had, for the first time, received “A” status from a cluster of global human rights organisations. He said effective legislation had been enacted to protect the rights of women, children, and minorities.
Meanwhile, Minister of State for Interior Talal Chaudhry stated that Pakistan’s passports have been upgraded with international security features to prevent forgery. He added that airports and seaports are now integrated with AI systems to ensure that no person can leave the country without a valid visa and the necessary legal documents.
Published in Dawn, June 26th, 2025