BeNewz
Related Articles
The negotiations between the Government of Pakistan and the International Monetary Fund (IMF) have entered their fourth consecutive day, with discussions intensifying over critical financial measures. Among the key considerations is the inclusion of retailers, property owners, and agricultural income within the tax net. Additionally, the government is contemplating stringent fiscal measures starting April 1, with the possibility of increasing direct taxes.
Sources reveal that the Federal Board of Revenue’s (FBR) tax collection target of Rs 12.5 trillion may be revised downward, as discussions with the IMF explore the feasibility of reducing this benchmark. The primary objective of the ongoing IMF program is to generate a budget surplus of Rs 1.2 trillion in the current fiscal year. Given this, the government is expected to introduce even tougher financial measures to meet these stringent economic goals.
As negotiations reach a crucial stage, the IMF has sought a detailed account of the financial losses incurred by state-owned enterprises. Meanwhile, officials from the Ministry of Finance indicate that efforts to expand the direct tax base remain a priority. This includes bringing retailers, property owners, and agricultural earnings under taxation. With the fiscal year’s final quarter approaching, authorities anticipate the necessity of aggressive revenue-generation strategies, which are likely to take effect from April 1.
In line with its demand for stricter fiscal discipline, the IMF has made it clear that no justifications for revenue shortfalls will be accepted. The institution has urged the government to implement downsizing measures to curtail unnecessary expenditures. To ensure financial stability, the Public Sector Development Program (PSDP) will also be placed under strict control, while additional revenue collection efforts will target retailers and the real estate sector. Emergency measures are being planned to address an accumulated fiscal deficit of Rs 600 billion over the past eight months, with the IMF mission and Pakistani authorities working jointly to execute these strategies.
Meanwhile, in another significant development, the government has set a deadline for public officials to declare their assets by September. As per sources, a digital portal will be launched to facilitate this process, a move initiated at the IMF’s request. The Ministry of Finance and the Cabinet Division have prepared a draft proposal outlining the mechanism for asset declaration, which will be shared with the IMF for review.
Further, an agreement has been reached between Pakistan and the IMF to avoid introducing a mini-budget to address revenue shortfalls. Instead, authorities plan to generate Rs 157 billion through a super tax. To bridge the revenue gap, the government has also decided to expedite the resolution of pending tax cases in courts, with direct intervention from the Prime Minister’s Office ensuring swift hearings.
The Ministry of Finance has confirmed that discussions with the IMF continue on several critical economic issues, including external financing, the operationalization of the tax policy unit, and inflation trends in comparison with regional countries. Additional areas of focus include national accounts, labor force surveys, family budget assessments, and living standards reports. Key negotiations have also taken place regarding electricity and gas tariffs, as well as circular debt management. As part of today’s agenda, further discussions will be held on the asset declaration framework for government officials. The finalized draft will be formally presented to the IMF as negotiations progress towards a decisive phase.
