Friday, Federal Minister for Finance and Revenue Ishaq Dar stated that in accordance with the policies agreed upon with the International Monetary Fund (IMF), the government would impose additional tax measures totaling Rs170 billion.
Dar addressed the media and stated, “We ended the final round of talks with the IMF after ten days of extensive discussions on power, fiscal, and monetary sides.”
The finance minister went on to say that the government will continue to put the IMF agreement into action.
He clarified that this fiscal year, Rs170 billion in taxes must be collected.
Dar’s press conference follows a statement made by the IMF at the end of its 10-day visit to Islamabad, in which the lender emphasized that, despite appreciating the commitment, “timely and decisive implementation of policies along with resolute financial support from official partners are critical for Pakistan to successfully regain macroeconomic stability.”
An agreement to revive the program through a staff-level agreement may still take some time as Pakistan moves to execute the previous actions, as the IMF added that virtual discussions will continue to finalize the implementation details of policies.
Prior to Thursday’s press conference, Secretary of Finance Hamid Yaqoob Shaikh informed members of the media that staff-level agreement would be reached once the IMF headquarters in Washington granted approval for the agreement on actions and prior actions.
The official also said that there are some differences between the two sides and that the solution doesn’t fit the Fund’s mission. The staff team has to explain these differences to their seniors for internal processing.
He said, “We have reached agreement with the Fund on actions and prior actions, but staff-level agreement would be reached later after approval by Washington [IMF headquarters].” He also said that the Fund’s team shared a memorandum of economic and financial policies (MEFP) with Pakistani authorities and talked about the country’s need for external financing.
He stated that Pakistan was not asked anything different this time because the IMF board always seeks assurance of bilateral and commercial financing.
