Pakistan Faces Prolonged IMF Cycle Without Tax Hike, Says Finance Minister

Pakistan Faces Prolonged IMF Cycle Without Tax Hike - ahgroup-pk

ISLAMABAD: Federal Finance Minister Muhammad Aurangzeb cautioned that Pakistan will stay in the IMF cycle if taxes are not raised.

In an interview, Muhammad Aurangzeb said: “upcoming IMF program will not be our last fund program if we don’t bring our tax revenues up.”

He emphasised that Pakistan will reach a staff-level agreement with the IMF this month, estimating the agreement to be worth $6-8 billion,the government’s reliance on imports has led to a cycle of debt and borrowing, stressing the need to enhance the country’s ability to repay loans.

The Finance Minister also mentioned the lack of trust in the Federal Board of Revenue (FBR) due to corruption, stating that people are hesitant to pay taxes due to these issues. The government must demonstrate positive performance in the next 2-3 months to address the country’s financial challenges.

Earlier, the International Monetary Fund appreciated Pakistan’s tough economic decisions and efforts regarding the hike in gas prices.

It is pertinent to mention that the fund’s delegation, led by Mission Chief Nathan Porter, visited Pakistan and held extensive negotiations from May 13 to May 23 to discuss the country’s economic improvements.

The International Monetary Fund (IMF) mission reaffirmed its dedication to fostering sustainable economic growth through collaboration. Highlighting Pakistan’s progress, the statement emphasized that the economy is on track to stabilize under the Extended Fund Facility (EFF) program. Pakistan’s fulfillment of targets outlined in the Standby Arrangement will strengthen the upcoming loan program.

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