The Pakistani government’s request for an extension to the Pakistan Raises Revenue (PRR) project has been approved by the World Bank. This extension allows for an additional year, with the project’s completion date now set for June 30, 2025. Alongside the extension, the project’s components will undergo restructuring.
Originally valued at $400 million, the PRR project focuses on enhancing Pakistan’s tax system through a combination of results-based initiatives and direct investments in infrastructure and technology.
The extension aims to provide sufficient time for the completion of the Investment Project Financing (IPF) component, while also necessitating adjustments to project development objectives and performance indicators.
Key revisions include a shift in focus from the Tax-to-GDP ratio to the Federal Board of Revenue’s (FBR) total collections as a percentage of GDP. This change seeks to better reflect the FBR’s efforts and the project’s impact on revenue collection.
Furthermore, the restructuring addresses changes in measurement methodologies for certain performance indicators, such as customs clearance efficiency. This adjustment is in response to the discontinuation of the World Bank’s Doing Business Report, prompting the project to adopt real-time data and case studies for progress assessment.
Since its inception, the PRR project has disbursed approximately $291.31 million, marking significant progress in simplifying the tax system, improving taxpayer compliance, and enhancing institutional efficiency.
The World Bank’s approval of the extension and restructuring underscores confidence in the project’s ongoing success and its alignment with Pakistan’s economic reform objectives.
