The IMF has given its nod of approval to Pakistan’s forthcoming fiscal budget, underscoring the need to abolish tax exemptions surpassing Rs 3 trillion. This measure is integral to Pakistan’s pursuit of a $6 to $8 billion loan from the IMF, directed at bolstering the nation’s foreign reserves. An agreement between Pakistan and the IMF is slated for staff-level approval by June or July.
In tandem with this, the Federal Board of Revenue (FBR) has set an ambitious target of garnering over Rs 3.8 trillion through taxation. Leveraging advanced technology, the FBR aims to clamp down on tax evasion and streamline tax collection processes. Notably, a pivotal political development has transpired, with various Pakistani parties agreeing to refrain from politicizing the IMF program.
This bipartisan consensus is poised to expedite the program’s implementation across federal and provincial levels, ensuring the seamless execution of IMF recommendations.
For the fiscal year 2025, Pakistan has allocated a budget of Rs 18.877 trillion, reflecting a 29% surge in current expenditure compared to the previous year. This budget encompasses several initiatives designed to address economic challenges and bolster developmental endeavors nationwide.
In a bid to augment non-tax revenue streams, the government intends to hike the Petroleum Development Levy to Rs 80 per liter, with an estimated collection of approximately Rs 1.3 trillion. The proceeds from this levy escalation will bolster various governmental initiatives and contribute to curbing the fiscal deficit.