World Bank backs Sindh municipal revenue program with U.S.$150 million financing

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World Bank backs Sindh municipal program

Highlights

World Bank approved U.S.$150 million financing for Sindh Property Revenues Enhancement Program to boost urban immovable property tax collection and service delivery.
The program targets raising Karachi's annual property tax collection from U.S.$8.5 million to U.S.$85 million and compliance from 20% to 50%.
Funding covers Karachi's 25 local councils, aims to directly benefit 3.58 million people with results-based awards, and includes U.S.$40 million for tax administration expansion in 20 other urban centers.

Sindh program targets tax collection and service delivery

As announced by the World Bank, its Board of Executive Directors today approved U.S.$150 million in financing for the Sindh Property Revenues Enhancement Program, or Sindh PREP, to help improve urban immovable property tax collection and strengthen municipal service delivery in selected local councils across Sindh.

The program is designed to support the Government of Sindh in raising compliance from 20% to 50% and increasing Karachi's annual property tax collection to U.S.$85 million from about U.S.$8.5 million. The World Bank says the effort will include a management information system for billing, payment processing and grievance redress, alongside integrated financial management information systems across local councils.

About 70% of collected urban immovable property tax revenues are set to be reinvested directly into municipal infrastructure and services in participating councils. Bolormaa Amgaabazar, World Bank country director for Pakistan, says Sindh's local councils currently depend on provincial transfers for more than 95% of their revenues, limiting their ability to plan and invest for the long term.

Karachi councils and other urban centers set to benefit

The program covers Karachi's 25 local councils and is expected to directly benefit 3.58 million people living in those jurisdictions, where service delivery investments are due to be financed. Funding is linked to results, with annual performance assessments by an independent verification agent determining the awards each council receives.

Those awards are intended to finance rehabilitation of climate-resilient municipal infrastructure and services, including drainage, sewerage, schools, fire stations, roads and street lighting. The package also includes a U.S.$40 million investment project financing component to expand property surveys and tax administration to 20 local councils in Sindh's other urban centers, indirectly benefiting about 4.5 million people.

Davison Muchadenyika, a senior urban development specialist at the World Bank, says Karachi has substantial untapped potential to generate more revenue from its property base and use those resources to fund infrastructure for residents and businesses. The lender says Pakistan has been a World Bank member since 1950 and that its current portfolio in the country includes 47 operations with total commitments of about U.S.$16.1 billion.

Our earlier article on Pakistan’s Tax Year 2026 income tax filing deadline highlighted mounting pressure on the Federal Board of Revenue to extend the submission window amid reported IRIS portal glitches and delays in finalizing return forms. It also covered requests from business groups and legal voices for a longer filing period to reduce compliance risks and prevent penalties caused by procedural and technical hurdles.

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