ISLAMABAD: Pakistan’s tax administration is set to shift toward an artificial intelligence-led engagement model, with human intervention between the tax authority and taxpayers reduced to a minimum, Finance Minister Muhammad Aurangzeb said while addressing a banking summit in Karachi.
The minister noted that Parliament has approved a new tax administration structure under which taxpayer notices will now be issued through AI-led systems, marking a shift from the traditional, human-dependent compliance process.
On external financing, Aurangzeb expressed optimism over Pakistan’s entry into international bond markets, citing the recent Panda Bond issuance as a notable milestone despite the country’s late arrival in China’s capital markets. The bond, launched in mid-May, raised the equivalent of $250 million in yuan and attracted demand exceeding five times its target.
The government is now preparing additional Eurobonds and sukuk, with upcoming instruments structured as dollar-settled, rupee-linked bonds, a first for Pakistan. Requests for proposals have been sent to international investors to gauge pricing and demand.
Following Pakistan’s re-entry into the international bond market after a four-year gap, strong Eurobond demand has created room to raise issuance size to $750 million, the minister said.
On capital markets, Aurangzeb said activity drivers mattered more than headline index figures, citing a growing investor base, including Gen Z participants, and a return to double-digit corporate profitability.
On fiscal policy, he said this year’s budget was formulated for the first time by the Tax Policy Office, now under the Finance Division, with focus on export-led growth through removal of the advance and super taxes.
Pakistan Banks’ Association Chairman Zafar Masood added that the banking sector paid over Rs1 trillion in annual taxes, with agriculture lending up 39 percent, housing lending up 90 percent, and SME lending growth exceeding 111 percent year-on-year.
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