ISLAMABAD: The Ministry of Finance has proposed a new local tax on Islamabad residents after the capital becomes a separate administrative unit.
According to ministry sources, the proposal aims to generate revenue for essential public services and the capital’s administrative structure.
The government would spend the locally collected revenue exclusively within Islamabad.
The funds would support hospitals, educational institutions, welfare programmes and administrative infrastructure, according to the sources.
Meanwhile, officials plan to discuss the proposal with the International Monetary Fund during upcoming economic review talks.
The government has proposed introducing the tax in the budget for the next fiscal year.
However, officials have not yet finalized the revenue required to operate Islamabad’s proposed administrative structure.
Officials said the tax would create additional fiscal space while addressing the capital’s infrastructure and development needs.
Proposal to Pass Through Committees
The proposal will first go before a subcommittee examining taxation matters linked to Islamabad’s autonomous administrative status.
After approval, officials will submit the proposal to a committee headed by Planning Minister Ahsan Iqbal. The committee will review the proposed tax before forwarding it to Prime Minister Shehbaz Sharif for consideration.
Furthermore, the government will seek the IMF’s approval during the upcoming economic review negotiations. The final decision will depend on the outcome of these discussions and the government’s assessment of Islamabad’s financial requirements.
If approved, the new tax could provide a dedicated revenue stream for improving public services and infrastructure across the federal capital.
