What happened
A Pakistan Peoples Party (PPP) delegation led by party chairman Bilawal Bhutto-Zardari raised reservations about taxes in a pre-budget meeting with Deputy Prime Minister and Foreign Minister Ishaq Dar on 7 June 2026, sources told Dawn.
The meeting was held at the Zardari House in Islamabad and was the second round of pre-budget talks between the two major ruling partners, the PML-N and the PPP. Besides Bilawal, the delegation included Sherry Rehman, Naveed Qamar, Murad Ali Shah and Jam Khan Shoro. An official PPP statement said budget matters were discussed, along with expenditure, development spending priorities such as the Public Sector Development Programme, fiscal sustainability, public welfare and inclusive growth.
Sources told Dawn that Dar assured the PPP its proposals would be incorporated in the budget, and that a third and final round of talks was expected the following day. The budget for the fiscal year 2026-27 was due to be announced on 10 June.
The meeting took place against the International Monetary Fund’s demands for additional revenue. According to Dawn, the IMF has asked the Centre to introduce at least Rs430 billion worth of additional budgetary measures, alongside a nearly matching Rs430 billion to be generated by the four provinces. A source said the PPP pointed out that the provinces had been asked to raise their revenue targets to help meet the Fund’s requirements, and asked Dar how the provinces were expected to increase their tax revenues.
Why it matters
The talks expose the fiscal squeeze facing the coalition before the budget is presented. The government must satisfy IMF conditions including primary surplus and revenue targets while avoiding a political backlash over new taxes on households already under pressure from inflation and higher energy costs.
A PPP leader told Dawn the party was trying to reach an agreement with the ruling PML-N on fiscal measures in light of the new IMF demands and was “unhappy with the budget in its current form”. The leader said the government wanted to tax the same classes instead of expanding the tax base, and that PPP leaders opposed new taxes, preferring a broader base and relief for inflation-hit households. One insider said the IMF had also set targets for the provinces, which the source described as an unprecedented move.
Because the PPP is a coalition partner, its reservations are a negotiating position rather than an outright rejection of the budget. The final round of talks and the budget presentation on 10 June would determine whether the differences were resolved.
What is still uncertain
Dawn reported the discussions based on sources and an official party statement, and did not publish the specific tax measures the PPP objected to. The exact size and composition of the federal and provincial revenue measures must still be finalised, and it is not clear which, if any, of the PPP’s proposals would be reflected in the finance bill.
Sources & reporting notes
This is a summary of published reporting, not independent reporting. Details are as carried by the cited source, which was reviewed on 2026-06-07.
- Dawn — "PPP shares tax-related reservations in pre-budget meeting with Dar, say sources"7 June 2026 · Reports the Zardari House meeting, the participants, the IMF revenue demands and the PPP's concerns about the tax base.
