The Ministry of Finance said on Thursday that a media report claiming Deputy Prime Minister and Foreign Minister Ishaq Dar had been handed the budget-making process was “misleading” and “factually incorrect”.
The clarification came after a report published by The Express Tribune said the government had “handed over the responsibility of making the new budget to Dar after it found the initial work below par”.
According to the report, Prime Minister Shehbaz Sharif had constituted a Dar-led committee to “review, analyse and present tax policy proposals” formulated by the Tax Policy Office working under the Finance Division.
Citing a notification, it added: “With the formation of the committee, the final responsibility to finalise roughly Rs215 billion to Rs230bn in new taxes and to grant any tax relief has been handed over to Dar.”
Moreover, the report said, the responsibility for finalising the enforcement measures had been handed over to a committee led by Minister for Economic Affairs Ahad Khan Cheema.
It mentioned that “the prime minister’s decision to place Dar at the head of the budget committee and Cheema at the head of the enforcement committee suggests that budget-making responsibility, for all practical purposes, no longer rests in the Q Block – the seat of the finance minister”.
In its clarification on Thursday, the finance ministry said it “strongly rejects the misleading and speculative impression created by The Express Tribune story titled ‘PM hands budget-making to Dar’”.
“The story incorrectly portrays the constitution of a high-level review committee by the prime minister as a ‘handover’ of the budget-making process from the Finance Division or as a ‘sidelining’ of the finance minister. This interpretation is factually incorrect, misleading and does not reflect the actual mandate or functioning of the committee,” it said.
The ministry’s statement further said that the committee constituted by the PM had been tasked with reviewing and analysing certain tax policy proposals prepared by the Tax Policy Office in the context of the upcoming budget.
“Such consultative and inter-ministerial review mechanisms are neither unusual nor extraordinary, particularly when fiscal measures carry significant economic, political and public implications,” it said.
Moreover, as head of the government, the prime minister “is fully within his constitutional and administrative authority to seek broader input from relevant cabinet members before finalisation of tax proposals that may impact businesses, inflation, investment climate and the wider economy”, the ministry contended.
It asserted that “at no stage has the budget-making process been shifted away from the Ministry of Finance or the Finance Division”.
“The preparation of the federal budget, including macroeconomic framework, fiscal strategy, expenditure planning, IMF engagement and overall budget coordination, continues to be undertaken by the Ministry of Finance under the leadership of the finance minister,” it added.
The statement also highlighted that Finance Minister Muhammad Aurangzeb himself was a member of the committee constituted by the PM, saying that he “continues to lead Pakistan’s engagement with the International Monetary Fund and other international financial institutions on all budgetary and macroeconomic matters”.
“Similarly, the committee relating to enforcement measures has been formed only to refine and strengthen revenue administration and enforcement proposals in consultation with relevant stakeholders. Such coordination mechanisms are a normal feature of governance and fiscal management,” it said.
The ministry said the headline and framing of The Express Tribune report “appear designed to create an impression of internal divergence within the government where none exists. The federal budget remains a collective constitutional and cabinet-driven exercise carried out under the leadership of the prime minister with the Ministry of Finance playing its central and mandated institutional role”.
“The ministry expects responsible sections of the media to avoid speculative interpretations and to report institutional processes with accuracy, context and due professional responsibility,” its statement said.
Later in the day, DPM Dar chaired a meeting of the newly formed committee to deliberate on “tax policy proposals” for the upcoming budget, as per a statement from his office.
In a post on X, the DPM Office said that during the meeting, the committee “reviewed progress on various proposals”.
It further “emphasised the need for balanced, growth-oriented measures aimed at broadening the tax base, enhancing revenue generation, and promoting investment and economic growth”.
As per the statement, the meeting also “reiterated the priority for balanced and growth-oriented measures that enhance revenue generation while safeguarding compliant taxpayers from additional tax burden”.
