Pakistan Likely To Tax Cryptocurrency Transactions In Upcoming Budget

The conversation around cryptocurrency in Pakistan is changing fast. For years, investors operated in a gray area where buying and selling digital assets was neither fully regulated nor formally taxed. Now, with the upcoming Budget 2026-27, that situation could be about to change.

According to reports, the federal government is considering a capital gains tax on profits earned through crypto trading. The proposed rate could fall between 20% and 30%, making it one of the most significant policy developments for Pakistan's digital asset market in recent years. The move is reportedly being discussed with the International Monetary Fund (IMF) as part of broader economic reforms.

In many cases, governments introduce taxation only after an industry reaches a meaningful size. Pakistan appears to be following a similar path. With millions of users actively trading digital assets, policymakers are now looking for ways to bring this growing sector into the documented economy.

From experience, one common mistake people make is assuming that regulation automatically hurts investors. In reality, a clear legal framework often creates more confidence and attracts serious investment. Countries such as the United States, the United Kingdom, and the United Arab Emirates have already developed systems for taxing and regulating digital assets while still supporting innovation.

The proposed budget 2026 measures could reshape how Pakistan's cryptocurrency market operates. Investors, traders, and businesses will need to understand what these changes mean, how potential taxes may be calculated, and what steps they should take to stay compliant.

This guide breaks down everything you need to know about the latest budget proposal, the expected tax rules, and the potential impact on Pakistan's rapidly growing digital economy.

Pakistan Moves Toward Cryptocurrency Taxation

Why the Government Is Taking Action Now

Pakistan's approach toward cryptocurrency is entering a new phase. After years of uncertainty, the government is reportedly preparing to bring digital asset profits into the country's formal tax system through the upcoming Budget 2026-27.

The proposed move focuses on applying a capital gains tax to profits earned from buying and selling crypto assets. While the final rate has not yet been announced, reports suggest it could range between 20% and 30%.

Growing Crypto Adoption Is Hard to Ignore

One of the biggest reasons behind this policy shift is the rapid growth of crypto usage across Pakistan.

According to estimates cited in recent reports:

• Pakistan has around 9 million crypto users
• The country ranks among leading nations for crypto adoption
• Millions of dollars move through digital asset platforms every year
• Most transactions currently remain outside the documented tax framework

As the market expands, regulators are facing increasing pressure to create rules that protect investors while generating government revenue.

The Role of IMF Consultations

The proposed taxation framework is not being developed in isolation. Government officials have reportedly consulted with the IMF while preparing the latest budget proposal.

This signals a broader effort to strengthen tax collection and document emerging sectors of the economy. Similar reforms have been introduced in several countries where digital assets have become a significant part of financial activity.

What Could Change for Investors?

If approved, the new rules may require investors to:

• Report crypto-related profits
• Maintain transaction records
• Calculate gains and losses accurately
• Pay applicable taxes on realized profits

From experience, markets tend to mature when regulations become clearer. While some traders worry about higher costs, others see taxation as a step toward legitimacy and long-term stability. For Pakistan, the real challenge will be creating a framework that generates revenue without discouraging innovation or pushing investors toward offshore platforms.

Why Is Pakistan Taxing Cryptocurrency Now?

The Digital Asset Market Has Reached a Turning Point

The primary reason Pakistan is considering a cryptocurrency tax framework is simple: the market has become too large to ignore.

Over the past few years, thousands of Pakistanis have entered the crypto space looking for investment opportunities beyond traditional stocks, real estate, and savings accounts. What started as a niche investment trend has evolved into a multi-billion-rupee ecosystem.

Government officials believe a growing portion of financial activity is taking place outside the documented economy. As a result, profits generated from crypto trading often remain outside the existing tax system.

Expanding the Tax Base Is a Major Goal

Pakistan has long struggled to increase its tax-to-GDP ratio. Bringing digital assets into the tax net could help broaden revenue collection without introducing entirely new taxes on traditional sectors.

The proposed measures under Budget 2026 aim to:

• Document crypto-related transactions
• Increase tax compliance
• Reduce informal financial activity
• Generate additional government revenue
• Create a legal framework for digital assets

Many developed economies have already adopted similar approaches, treating crypto profits much like gains from stocks or securities.

Learning From Global Examples

A frequently discussed example on investment forums and platforms like Quora involves U.S. investors who initially viewed crypto taxes as a burden. However, many later realized that regulation improved market transparency and reduced uncertainty.

One investor shared that clearer reporting rules made it easier to manage investments and work with financial institutions. While Pakistan's market differs significantly, the lesson remains relevant: regulation often follows growth.

Balancing Revenue and Innovation

The challenge for policymakers is finding the right balance.

On one side, the government wants additional revenue from a rapidly expanding sector. On the other, excessive taxation could push traders toward foreign exchanges or underground markets.

This is why many tax experts are urging policymakers to create practical compliance rules rather than focusing solely on collection. A balanced budget proposal could help Pakistan benefit from the growth of digital assets while encouraging responsible participation in the crypto economy.

How Much Tax Could Crypto Investors Pay?

Proposed Tax Rates Under Budget 2026

One of the biggest questions surrounding the upcoming budget 2026 announcement is how much tax crypto investors may actually have to pay.

According to reports, the government is considering a capital gains tax between 20% and 30% on profits generated from cryptocurrency transactions. While the final percentage has not been officially confirmed, the proposed range has already sparked debate among investors and industry stakeholders.

The tax would likely apply when an investor sells a digital asset and realizes a profit. In simple terms, gains would only become taxable after a sale occurs, not while assets remain in a wallet.

Example of a Potential Tax Calculation

Consider a simple scenario:

Transaction	Amount
Bitcoin Purchase	Rs. 500,000
Bitcoin Sale	Rs. 800,000
Capital Gain	Rs. 300,000

If a 20% tax rate applies:

Calculation	Amount
Profit Earned	Rs. 300,000
Tax Payable (20%)	Rs. 60,000
Net Profit	Rs. 240,000

If the rate reaches 30%, the payable amount would increase significantly.

Could Holding Periods Affect Tax Rates?

Several tax experts have suggested a structure similar to stock market taxation.

Under this approach:

• Short-term trades may face higher tax rates
• Long-term holdings could receive favorable treatment
• Investors may be encouraged to hold assets longer
• Excessive speculative trading may become less attractive

This model is used in various international markets because it rewards long-term investment behavior.

What Investors Should Prepare For

From experience, many traders focus only on profits and overlook record keeping. That can become costly once regulations arrive.

Investors should start maintaining:

• Purchase records
• Sale records
• Exchange statements
• Wallet transaction history
• Profit and loss calculations

If the proposed budget proposal becomes law, accurate documentation could be just as important as making successful trades. The investors who prepare early are often the ones who face fewer compliance issues when new rules take effect.

How Will Cryptocurrency Gains Be Calculated?

Understanding the FIFO Method

One of the most important parts of the proposed cryptocurrency tax framework is how profits will actually be calculated. According to discussions surrounding the new policy, Pakistan may adopt the First-In, First-Out (FIFO) valuation method.

FIFO assumes that the first coins you purchase are the first ones you sell. This method is already used in many countries because it creates a consistent approach for calculating gains and losses.

For investors who have been buying crypto over several years at different prices, the valuation method can have a major impact on their final tax bill.

FIFO vs Average Cost Method

Feature	FIFO Method	Average Cost Method
Sale Calculation	Oldest assets sold first	Uses average purchase price
Tracking Complexity	Moderate	Simple
Tax Transparency	High	Medium
Global Adoption	Widely used	Less common
Audit Friendly	Yes	Depends on records

Many regulators prefer FIFO because it provides a clearer transaction trail and reduces reporting disputes.

Practical Example

Imagine an investor buys Bitcoin in three stages:

Purchase Date	Amount Invested
January	Rs. 200,000
March	Rs. 300,000
June	Rs. 400,000

Later, the investor sells part of the holdings.

Under FIFO, the January purchase would be treated as the first asset sold. Any gain would be calculated using that original purchase price rather than newer purchases.

Common Mistakes Investors Make

From experience, one common mistake people make is relying solely on exchange dashboards for profit calculations. Those records are not always complete.

To avoid future compliance issues, investors should maintain:

• Exchange transaction reports
• Wallet transfer history
• Deposit and withdrawal records
• Purchase invoices where available
• Screenshots of major transactions

Why Accurate Records Matter

As the government develops its budget proposal, documentation is becoming just as important as investment performance.

Many tax experts believe that investors who maintain proper records today will face fewer complications once reporting requirements become mandatory. Good record keeping can also help reduce disputes, identify deductible losses, and ensure gains are calculated fairly.

In a regulated environment, successful investing is no longer just about earning profits. It is also about proving how those profits were earned.

Which Crypto Activities Could Fall Under the Tax Net?

Crypto Trading May Be Just the Beginning

Most discussions around the new cryptocurrency framework focus on buying and selling digital assets. However, trading profits are only one part of today's crypto ecosystem.

Modern investors generate income through multiple activities, many of which create unique challenges for regulators and tax experts.

As Pakistan develops its budget proposal, authorities will likely need to decide how these earnings should be classified and taxed.

Activities That May Be Subject to Taxation

The following crypto-related activities are currently under discussion globally and could eventually become part of Pakistan's taxation framework:

• Cryptocurrency trading profits
• Bitcoin and crypto mining rewards
• Staking income
• Yield farming earnings
• DeFi lending rewards
• NFT sales and trading
• ICO investments
• IEO participation
• Token airdrops
• Referral and affiliate rewards

Each activity generates value differently, making tax treatment more complex than traditional investments.

Comparison of Potentially Taxable Activities

Activity	Possible Tax Treatment	Complexity Level
Crypto Trading	Capital Gains Tax	Low
Mining Rewards	Income Tax	High
Staking Rewards	Income Tax	Medium
NFT Sales	Capital Gains Tax	Medium
DeFi Yield Farming	Income Tax	High
ICO Token Sales	Case-by-Case	High
Airdrops	Potential Income Tax	Medium

Why DeFi and NFTs Create Challenges

Unlike traditional financial systems, many decentralized finance platforms operate without banks or centralized intermediaries.

For example, an investor may earn rewards from staking assets on an international platform without ever receiving funds through a Pakistani bank account.

From experience, these situations often create reporting difficulties because tracking the value of digital assets at the exact time they were received can be complicated.

What Investors Should Watch Closely

Many investors focus only on trading profits and forget that non-trading rewards can also generate taxable income.

A few areas worth monitoring include:

• Staking reward distributions
• NFT profit realization
• DeFi lending income
• Token giveaways and airdrops
• Mining revenue

As Pakistan finalizes its budget 2026 measures, detailed guidance on these activities will be crucial. Without clear definitions, investors could struggle to understand their obligations, while regulators may face challenges enforcing compliance across a rapidly evolving digital asset market.

Challenges in Regulating Pakistan's Crypto Market

Building Rules Is Easier Than Enforcing Them

Creating a legal framework for cryptocurrency is only half the challenge. The real test begins when regulators try to enforce those rules across a market that operates largely without borders.

Unlike traditional financial systems, crypto transactions can occur directly between individuals, through international exchanges, or on decentralized platforms that have no physical presence in Pakistan.

This makes monitoring activity significantly more difficult than tracking transactions through local banks or stock exchanges.

Why Regulators Face Unique Challenges

Several factors complicate crypto regulation in Pakistan:

• Offshore exchange accounts
• Peer-to-peer (P2P) trading
• Anonymous wallet addresses
• Cross-border transactions
• Decentralized finance platforms
• Lack of centralized reporting systems

Many investors opened foreign exchange accounts years ago because no local regulatory framework existed. Tracking these historical activities presents a major challenge for authorities.

Pros and Cons of Crypto Taxation

Advantages

Pros	Impact
Increased tax revenue	Supports government finances
Better market transparency	Encourages accountability
Stronger investor protection	Reduces fraud risks
Improved regulation	Supports long-term growth
Greater international credibility	Attracts institutional investors

Disadvantages

Cons	Impact
Higher compliance burden	More paperwork for investors
Risk of capital flight	Investors may move funds abroad
Reduced short-term trading activity	Lower market volume
Enforcement difficulties	Limited monitoring capabilities
Regulatory uncertainty	Confusion during transition

The Growing Role of P2P Trading

One area attracting significant attention is peer-to-peer trading.

Many Pakistani investors use P2P platforms to buy and sell digital assets directly with other users. Since these transactions often bypass traditional financial channels, documentation becomes more challenging.

From experience, one common mistake people make is assuming that P2P transactions are invisible forever. As regulatory systems evolve, authorities often develop new ways to identify transaction patterns and reporting gaps.

What Tax Experts Are Warning About

Many tax experts believe that introducing taxation without a practical compliance framework could create unintended consequences.

Potential risks include:

• Asset concealment
• Reduced voluntary compliance
• Movement of funds to foreign jurisdictions
• Lower participation in documented markets

For this reason, policymakers must balance enforcement with practicality. The success of the budget proposal may ultimately depend on how easy it is for investors to understand, report, and comply with the new rules. A well-designed framework could strengthen Pakistan's digital economy. A poorly designed one could push activity further underground, making regulation even more difficult.

What Happens to Existing Crypto Holdings?

A Major Concern for Current Investors

While the proposed cryptocurrency tax framework focuses heavily on future transactions, many investors are asking a more pressing question: what happens to assets they already own?

This is one of the most sensitive issues being discussed as part of the upcoming budget 2026 reforms.

For years, Pakistani investors operated in an uncertain environment where digital assets lacked clear legal recognition. As a result, many users opened accounts on international exchanges and stored assets in offshore wallets without specific reporting requirements. Now that taxation is being considered, policymakers must determine how these existing holdings will be treated.

Why Offshore Holdings Create Challenges

Many crypto users turned to foreign platforms because local options were limited or unavailable.

Common examples include:

• Binance accounts registered abroad
• Self-custody wallets
• Hardware wallet holdings
• International exchange accounts
• DeFi-based asset storage

The challenge for regulators is distinguishing between legitimate historical investments and assets intentionally concealed from the tax system.

Potential Approaches Under Consideration

Although no final policy has been announced, experts believe several options may be considered.

Possible Approach	Potential Outcome
Full disclosure requirement	Investors report existing holdings
Voluntary declaration window	Reduced penalties for compliance
Tax amnesty mechanism	Encourages asset disclosure
Immediate taxation	Higher compliance risks
Gradual implementation	Easier market transition

Many countries have adopted transitional compliance programs when introducing new digital asset regulations.

Real-World Investor Scenario

A common situation discussed on investment forums and Quora involves individuals who purchased Bitcoin years ago when regulations were unclear.

Imagine an investor who bought crypto in 2020 through an international exchange and never transferred funds through a Pakistani bank. If new reporting rules are introduced, that investor may need a legal pathway to disclose holdings without facing excessive penalties.

From experience, successful tax reforms often provide a reasonable transition period. Investors are far more likely to comply when governments offer clarity instead of uncertainty.

What Tax Experts Recommend

Many tax experts argue that forcing immediate compliance without a regularization mechanism could create unintended problems.

Potential risks include:

• Asset concealment
• Capital flight
• Reduced tax collection
• Lower voluntary compliance
• Movement to unregulated platforms

For this reason, experts continue to advocate for a balanced budget proposal that allows investors to declare existing assets while encouraging long-term participation in Pakistan's documented financial system. The treatment of existing crypto holdings may ultimately become one of the most important factors determining whether the new taxation framework succeeds or struggles.

Impact on Crypto Investors and Pakistan's Digital Economy

A New Era for Cryptocurrency in Pakistan

If the proposed cryptocurrency taxation framework becomes part of the final budget 2026, the impact will extend far beyond individual traders.

This policy could reshape how digital assets are viewed across Pakistan's financial sector. For some investors, taxation may initially feel like an added burden. For others, it could represent a major step toward legitimacy and long-term market stability.

Historically, regulated markets attract greater institutional participation because investors gain more confidence when clear rules exist.

Potential Benefits for Investors

A structured regulatory framework could provide several advantages:

• Greater legal clarity
• Improved investor protection
• Increased market transparency
• Reduced fraud risks
• Better integration with traditional finance

From experience, uncertainty often scares serious investors more than taxation itself. Clear regulations can make long-term planning easier.

Potential Risks for Investors

Despite the benefits, some concerns remain.

• Higher compliance costs
• Additional reporting requirements
• Reduced short-term trading profits
• Possible migration to offshore platforms
• Increased scrutiny of transactions

The final outcome will largely depend on how balanced the government's budget proposal becomes.

Pakistan vs Other Crypto Markets

Cryptocurrency Tax Comparison

Country	Crypto Status	Capital Gains Tax	Regulatory Maturity
Pakistan	Proposed Framework	20% - 30% (Expected)	Developing
UAE	Regulated	0% for many individuals	High
USA	Regulated	Varies by income	Very High
India	Regulated	30% Flat Tax	High
UK	Regulated	Capital Gains Structure	High

This comparison highlights an important reality. Pakistan is not introducing something unique. Most major economies already tax digital assets in some form.

Competitor Comparison: How Pakistan Could Position Itself

Factor	Pakistan	UAE	India
Tax Burden	Moderate to High	Low	High
Market Growth Potential	High	High	High
Investor Friendliness	Developing	Strong	Moderate
Regulatory Clarity	Emerging	Established	Established

One lesson from global markets is clear: investors prefer certainty. Even a moderate tax system can succeed if rules remain transparent and predictable.

What This Means for the Digital Economy

A well-implemented framework could encourage:

• More documented financial activity
• Growth of blockchain startups
• Increased foreign investment confidence
• Better integration with global financial markets
• Expansion of fintech innovation

Many tax experts believe regulation and innovation can coexist. The challenge is ensuring policies generate revenue without slowing technological progress. As Pakistan enters this new phase, the future of crypto may depend less on taxation itself and more on how effectively those rules are designed and implemented.

What Experts Are Saying About the Proposed Tax Framework

Most Experts Support Regulation, Not Uncertainty

The majority of industry professionals agree on one thing: Pakistan needs a clear regulatory framework for cryptocurrency.

However, support for regulation does not automatically mean support for every proposed tax measure. Many analysts believe the success of the upcoming budget proposal will depend on how practical and investor-friendly the final rules become.

According to financial professionals, taxation is expected in any mature market. The bigger concern is whether the reporting requirements, asset classifications, and compliance procedures remain simple enough for ordinary investors.

Key Recommendations From Tax Experts

Several tax experts have highlighted areas policymakers should prioritize:

• Clear definitions of digital assets
• Transparent gain and loss calculations
• Reasonable tax rates
• Voluntary disclosure opportunities
• Investor education programs
• Consistent reporting standards

Many experts also recommend phased implementation to reduce confusion during the transition period.

Customer Experience Highlights

Positive Feedback

Many long-term investors believe regulation could provide:

• Greater market credibility
• Improved investor confidence
• Reduced fraud risks
• Better legal protection

One investor on a cryptocurrency discussion forum explained that uncertainty was a bigger concern than taxation. According to the investor, knowing the rules allows people to plan their investments with greater confidence.

Concerns Raised by Traders

Active traders often express different concerns:

• Reduced profitability
• Complex reporting obligations
• Higher compliance costs
• Potential double taxation concerns

These concerns are common whenever governments introduce new tax systems for emerging asset classes.

What Competitors Often Miss

Most discussions focus only on tax rates.

In reality, the bigger issue may be compliance simplicity.

From experience, investors are generally willing to pay reasonable taxes when rules are clear. Problems usually arise when reporting systems become overly complicated.

Countries that successfully regulate crypto markets often focus on:

Success Factor	Importance
Clear regulations	Very High
Investor education	High
Fair tax treatment	High
Simple reporting	Very High
Enforcement consistency	High

The Most Likely Path Forward

Experts believe Pakistan's long-term objective is not simply collecting more revenue.

The broader goal appears to be creating a documented digital asset ecosystem that supports innovation while improving tax compliance.

If policymakers can balance these objectives effectively, the proposed budget 2026 measures could help transform crypto from an uncertain investment space into a more mature and regulated financial sector. The coming months will reveal whether the final framework achieves that balance.

What Crypto Users in Pakistan Should Do Now

Preparation Is Better Than Panic

With the possibility of new cryptocurrency taxation rules arriving through the upcoming budget 2026, investors should focus on preparation rather than speculation.

The final policy details have not yet been announced, but waiting until implementation could create unnecessary stress and compliance issues.

From experience, investors who organize their records early usually adapt more easily when regulations change.

Start Maintaining Detailed Records

Proper documentation may become one of the most valuable assets for crypto investors.

Keep records of:

• Purchase transactions
• Sale transactions
• Wallet transfers
• Exchange statements
• Staking rewards
• Mining income
• NFT purchases and sales
• DeFi earnings

Accurate records can simplify future tax calculations and help avoid disputes if reporting requirements become mandatory.

Review Your Current Portfolio

This is also a good time to conduct a portfolio review.

Ask yourself:

• Which assets are long-term investments?
• Which positions are purely speculative?
• Are transaction histories complete?
• Are assets spread across multiple exchanges?
• Can every major transaction be verified?

Many investors discover record-keeping gaps only when regulations arrive.

Investor Preparation Checklist

Action Item	Priority Level
Download exchange statements	High
Organize wallet records	High
Track gains and losses	High
Monitor government announcements	High
Consult professionals if needed	Medium
Review offshore holdings	Medium
Create backup records	Medium

Practical Advice From Tax Experts

Many tax experts recommend treating digital assets as if reporting requirements already exist.

This approach offers several advantages:

• Better financial organization
• Easier profit tracking
• Improved compliance readiness
• Reduced risk of future reporting errors

One common mistake people make is assuming historical transaction data will always be available from exchanges. Some platforms limit access to older records, making early downloads a smart precaution.

Stay Informed and Avoid Rumors

The crypto market often reacts quickly to headlines.

Investors should rely on:

• Official government announcements
• FBR updates
• Ministry of Finance statements
• Reputable financial publications
• Professional tax advisors

The final budget proposal may still undergo revisions before implementation. Pakistan's digital asset market is entering a critical phase. Whether you're a casual investor or an active trader, preparation today can help reduce uncertainty tomorrow. The most successful investors are not always the ones who predict every policy change. Often, they are the ones who stay informed, maintain proper records, and adapt quickly when new regulations arrive.

Final Thoughts: Is Pakistan Ready for Cryptocurrency Taxation?

The Road Ahead for Crypto Investors

Pakistan's decision to potentially tax cryptocurrency transactions marks a major shift in the country's approach to digital assets. What was once viewed as a largely unregulated market is gradually moving toward a more structured and documented financial ecosystem.

The proposed measures under Budget 2026 may introduce new compliance responsibilities for investors, but they could also provide something the market has lacked for years: clarity.

In many cases, investors are more concerned about uncertainty than taxation itself. Clear rules can help individuals make informed decisions, encourage responsible investing, and create opportunities for legitimate growth within the digital economy.

Key Takeaways

Before the final budget announcement, investors should remember:

• Capital gains tax may range between 20% and 30%
• Crypto trading profits are likely to face taxation
• FIFO valuation may be used for gain calculations
• Existing holdings could require future disclosure
• Record keeping will become increasingly important
• Regulatory clarity may improve investor confidence

Why This Matters for Pakistan

A balanced budget proposal has the potential to achieve two important goals simultaneously.

First, it can help expand the country's tax base and document previously untracked financial activity.

Second, it can create an environment where innovation, blockchain development, and digital finance continue to grow without unnecessary barriers.

The ultimate success of this framework will depend on whether policymakers can strike the right balance between revenue generation and market development. As Pakistan enters this new phase, the future of crypto may depend less on taxation itself and more on how effectively those rules are designed and implemented.

Frequently Asked Questions (FAQs)

1. Will cryptocurrency become legal in Pakistan after Budget 2026?

The proposed taxation framework does not automatically legalize all forms of cryptocurrency activity. However, many experts believe taxation could be a major step toward broader regulation and legal recognition.

2. What is the proposed tax rate on cryptocurrency profits in Pakistan?

Reports suggest the government is considering a capital gains tax between 20% and 30% on crypto trading profits. The final rate will be announced after approval of the budget.

3. Will crypto taxes apply only when I sell my assets?

Current proposals indicate gains may be taxed on a realized basis. This means taxes would generally apply when you sell or dispose of an asset and generate a profit.

4. Can offshore cryptocurrency holdings be taxed?

This remains one of the most debated issues. Policymakers are reportedly evaluating options for declaring and documenting previously undeclared offshore crypto assets.

5. Will staking and mining income be taxable?

Many tax experts expect staking rewards, mining income, and certain DeFi earnings to receive separate tax treatment because they generate income rather than capital gains.

6. How can investors prepare for the new cryptocurrency tax rules?

Investors should start maintaining transaction records, exchange statements, wallet histories, and profit-and-loss reports. Good documentation can simplify future compliance requirements.

7. Why is the government introducing cryptocurrency taxation now?

The rapid growth of crypto adoption in Pakistan, combined with efforts to broaden the tax base and improve financial documentation, are key reasons behind the proposed budget proposal.