Minister rejects reports claiming Pakistan backtracking from IMF programme

ISLAMABAD: Minister of State for Finance and Revenue Dr Aisha Ghaus Pasha on Wednesday categorically denied rumours claiming Pakistan was backtracking from the much-awaited $6.5 bailout programme with the International Monetary Fund (IMF).

Speaking to journalists after a meeting of the Senate Standing Committee on Finance, Pasha said: “We are in touch with the IMF and talks are ongoing between the Federal Board of Revenue (FBR) and Finance Division.”

Following reports that Pakistan has now adopted a strict stance against the IMF and has conveyed to the authorities that it would not shares details of the upcoming budget, rumours sparked that the cash-strapped nation was backtracking from the deal — which was originally signed by Imran Khan-led Pakistan Tehreek-e-Insaf (PTI) government.

“We want to continue the programme with IMF as the coalition government has paid a political price while making efforts to meet the conditions laid forth by the Fund,” Pasha said.

Pakistan has been negotiating with the IMF to restart a $6.5 billion bailout programme, which it needs to avoid a default.

She further told the reporters that the coalition government will present its second budget — since coming into power in April last year — in the first week of June.

Earlier, sources told Geo News that the finance minister will table the Finance Bill 2023-24 in the National Assembly on June 9 while the Economic Survey 2022-23 will be released on June 8.

“We are finalising the budget numbers while all parameters of the macroeconomic framework are ready,” she said, assuring the people that the government will try to provide relief to the masses amid these testing times.

While briefing the senate panel about the budget details, she warned that until the tax-to-GDP ratio strikes double digits, the situation will remain difficult. “Widening the tax net is imperative,” she maintained.

The state minister stated that the Ministry of Finance is planning to shift from indirect taxes to direct taxes, “direct taxation will reduce the burden on the common man.”

She reiterated that the government will slap direct taxes in the upcoming budget for the next fiscal year 2023-24, lamenting that the tax concessions have a negative impact on the economy.

Meanwhile, FBR Chairman Asim Ahmed briefed the committee on the capital value tax. He revealed that during the current financial year, Rs9 billion have been received in the form of the capital value tax.

Addressing the senators' concerns over the implementation of capital valuation tax on local and foreign assets, Ahmed said that this move aims to bring the wealthier into the tax net.

He added that the revenue board was also registering new people who have assets abroad while details of those who are already registered is available.