Dar says govt to impose Rs170bn taxes through mini-budget ahead of IMF deal
Business
Says the government has received the draft of the MEFP from the global lender
ISLAMABAD (Dunya News) - Finance and Revenue Minister Ishaq Dar on Friday said taxes worth Rs170 billion would be imposed ahead of the IMF deal.
The announcement came hours after the international financial institution issued a statement on its talks with Pakistan.
Addressing a presser in the federal capital, Dar said the parleys with the global lender ended "positively".
“Good news is [that] as per their commitment, the team has gone according to their plan. As per their commitment, we have received MEFP. The draft is with us, we will study it and from Monday we will engage in virtual discussion with the fund,” he said.
The minister said, the government was committed to fulfill its sovereign commitments and would complete the IMF programme for the second time in the history of the country.
He said, once completed and approved by IMF executive board, Pakistan would get a $1.2 billion tranche under the Extended Fund Facility.
The finance minister confirmed that the government had received the draft of the Memorandum of Economic and Financial Policies (MEFP) from the global lender.
He reminded that the programme that the incumbent government was implementing was the one signed by former prime minister Imran Khan with the IMF in 2019-2020.
Dar reiterated that the Shehbaz Sharif-led government were holding talks on this agreement as a "sovereign commitment".
"This is an old agreement which had been suspended and delayed previously," he reminded.
Regarding Pakistan's talks with the IMF, the minister said the 10-day-long discussions were extensive covering the power, and gas sector and on the fiscal and monetary side.
The SBP's governor and different sectors were involved in the talks, he said and added that Rs170 billion worth fiscal taxes and energy sector reforms would be implemented.
Dar also added that the government was focusing on "minimising untargeted subsidies".
-- IMF statement --
A timely and decisive implementation of policy measures along with resolute financial support from official partners are critical for Pakistan to successfully regain macroeconomic stability and advance its sustainable development, the International Monetary Fund’s mission chief Nathan Porter said in a statement on Friday.
He further said virtual talks would continue with Islamabad. The IMF mission led by Mr Porter visited Islamabad from January 31 to February 9 to hold discussions under the ninth review of the authorities’ program supported by the IMF Extended Fund Facility (EFF) arrangement.
At the end of the visit, Mr Porter issued the following statement:
“The IMF team welcomes the Prime Minister’s commitment to implement policies needed to safeguard macroeconomic stability and thanks the authorities for the constructive discussions.
“Considerable progress was made during the mission on policy measures to address domestic and external imbalances. Key priorities include strengthening the fiscal position with permanent revenue measures and reduction in untargeted subsidies, while scaling up social protection to help the most vulnerable and those affected by the floods; allowing the exchange rate to be market determined to gradually eliminate the foreign exchange shortage; and enhancing energy provision by preventing further accumulation of circular debt and ensuring the viability of the energy sector.
The statement further says the timely and decisive implementation of these policies along with resolute financial support from official partners are critical for Pakistan to successfully regain macroeconomic stability and advance its sustainable development.
“Virtual discussions will continue in the coming days to finalize the implementation details of these policies.”
