FBR’s Recent Measures to Broaden the Tax Base

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In what can be called a landmark victory for Pakistan, a court of arbitration in The Hague has ruled that India cannot unilaterally suspend the Indus Waters Treaty, rejecting every argument New Delhi has used to justify holding the six-decade-old water-sharing agreement “in abeyance” since April 2025. The five-member court found that the treaty “remains fully in force” and that India “must observe its obligations” under it, including those governing the design and operation of hydropower projects on rivers that flow into Pakistan. India, which is officially a member of the court, said it did not recognize the court and "categorically" rejected the verdict. Although the ruling strengthens Pakistan's position, even if it offers no obvious way to force India's hand, it has once again brought into the limelight the hydropolitics being played over the treaty.

Broadening the tax base is a core structural issue in the fiscal system of Pakistan, and it has many socioeconomic implications. With a population of over 250 million, only a few million people actually file income tax returns and around 3-4 million taxpayers only account for a large share of tax revenue. Agriculture, informal trade, real estate and many high‑income...

FBR’s Recent Measures to Broaden the Tax Base

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