Page 90 - CMA Journal (Mar-Apr 2026)

REGULATORY

WATCH

By: ICMA Research and Publications Department

SBP raises policy rate to 11.50 percent amid in ation risks regulatory guidance, and strengthened internal capacity
under ongoing reforms. April alone recorded 4,082
The Monetary Policy Committee (MPC) of the State Bank of
incorporations, the highest monthly level, while foreign
Pakistan raised the policy rate by 100 basis points to 11.50
participation also improved with investors from over 22
percent, effective April 28, 2026, citing rising in ation risks
countries. Around 220 companies with foreign shareholders
from the prolonged Middle East con ict, which has
were registered, with paid-up capital rising to Rs 882 million
increased global energy, freight, and insurance costs and
from Rs 277 million, mainly in trading, services, IT,
disrupted supply chains. It said in ation is likely to remain
construction, and mining sectors, with Chinese investors
above target in coming months, requiring a tighter stance to
among key participants.
anchor expectations, while noting in ation at 7.3 percent,
core in ation at 7.8 percent, GDP growth of 3.8 percent in H1 SECP issues rst digital nance licences, reduces backlog
FY26, a small current account surplus, and SBP reserves of
The Securities and Exchange Commission of Pakistan (SECP)
about $15.8 billion, and stressing scal discipline and
issued key digital nance licences, including the country's
reforms for stability and growth.
rst Shariah-compliant digital general takaful licence to First
SBP Half Year Report FY26 shows stability but ags risks Digital Takaful Company Limited and the rst digital
investment advisory services licence to Wealthbridge
The State Bank of Pakistan (SBP) has released its Half Year
Management Limited, while also licensing Punjab Life
Report FY26. It said macroeconomic stability improved in H1
Insurance Limited as the rst provincial government-owned
FY26 despite global uncertainty and oods, supported by
life insurer. Over the past three months, it disposed of 510
lower in ation, stronger foreign exchange buffers, and a
cases out of 1,143 total applications, bringing pending cases
scal surplus for the rst time since FY2002, driven by tighter
down to 633, alongside reforms to remove foreign security
policies, IMF support, and improved in ows. Growth
clearance requirements and simplify documentation for
strengthened, with real GDP rising faster than last year, led
Section 42 companies to support digitalization and ease of
by industry, services, and agriculture, while remittances
doing business.
helped contain the current account de cit. The report
warned that risks remain from the Middle East con ict, FBR plans AI tax monitoring and e-auction system
potentially affecting trade, remittances, and in ation. It also
The Federal Board of Revenue (FBR) is considering AI-based
cited structural constraints including low savings, weak
systems to detect false tax returns and discrepancies, along
exports, limited FDI, and a low tax-to-GDP ratio. SBP
with a digital e-auction platform for customs-seized goods,
projected FY26 growth near the lower end of 3.75–4.75
as part of upcoming budget reforms aimed at curbing
percent and said in ation may remain above the 5–7 percent
underreporting, under-invoicing, tax evasion, and
target range in FY27 due to energy price pressures.
smuggling. The proposals, reviewed in a high-level meeting,
SBP receives $1.3 billion from IMF under EFF and RSF focus on a technology-driven, business-friendly tax system
with minimal human interaction to improve compliance,
The State Bank of Pakistan (SBP) received about $1.3 billion
transparency, and efficiency, while FBR has been directed to
from the IMF under the Extended Fund Facility (EFF) and
re ne the measures before nalization to support broader
Resilience and Sustainability Facility (RSF) after the IMF
tax base expansion and scal stability.
Executive Board completed the third EFF review and
approved SDR 760 million, along with a second RSF tranche FBR tax shortfall rises to Rs 683 billion
of SDR 154 million in its meeting held on 8 May 2026. The
The Federal Board of Revenue (FBR) recorded a Rs 683 billion
combined disbursement of SDR 914 million was received on
tax shortfall during July–April FY26, collecting Rs 10.26
12 May 2026 and will be re ected in SBP's foreign exchange
trillion against the revised target as growth slowed to 10.5
reserves for the week ending 15 May 2026.
percent, with misses across income tax, sales tax, customs
SECP registrations up 21 percent to 10,511 companies duty, and excise, partly offset by import-stage taxes and Rs
499 billion in refunds, while the IMF allowed Pakistan to
The Securities and Exchange Commission of Pakistan (SECP)
recover the remaining Rs 53 per litre petroleum levy in two
reported a 21 percent increase in new company registrations
phases to support revenue efforts and help manage scal
during Feb–Apr 2026, with 10,511 companies incorporated
gaps under the ongoing programme through higher fuel
compared to 8,693 in the same period last year, driven by
levies and spending controls.
faster incorporation and licensing processes, improved
ICMA’s Chartered Management Accountant, Mar-Apr 2026 88