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February 8, 2019

Asad rules out downward revision of FBR revenue target

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February 8, 2019

ISLAMABAD: Ruling out possibility of slashing down the FBR’s annual target from Rs4,398 billion, Finance Minister Asad Umar has plainly conveyed to the tax machinery to gear up efforts to achieve the desired target without seeking any downward revision prior to holding video conference with the IMF.

During the conference call with the IMF’s mission chief Herald Finger on Thursday, Pakistan and the IMF explored the possibility of another Fund mission visiting Islamabad within next four to six weeks for renewed efforts to strike staff level agreement between the two sides.

However, both the Pakistani side and the IMF were tight-lipped and no one answered when this correspondent contacted them and requested them to say anything on record. Ahead of holding video conference with the IMF team in Washington DC, the finance minister told the FBR team that there was no possibility of any downward revision in the envisaged annual collection target at any cost. One official commented that it seemed that the government was seriously moving towards finalising agreement with the IMF.

So the minister advised them to gear up efforts and devise strategy to fulfil this challenge, one senior official said. In order to strike staff-level agreement with the IMF, the government has sought relaxation in the desired budget deficit target from 5.1 to 5.6 percent of GDP for the current fiscal year ending on June 30, 2019 arguing that the requirement of debt servicing had gone up after devaluation of exchange rate and hiking of discount rates but they assured the IMF team that the FBR would go close to its target of Rs4398 billion.

The FBR’s provisional collection stands at Rs2,060 billion for first seven months (July-Jan) period of the current fiscal against the desired target of Rs2,251 billion, indicating revenue shortfall standing at Rs191 billion. In remaining five months (Feb-June) period of the ongoing fiscal year, the FBR will have to collect Rs2,338 billion for demonstrating the desired target of Rs4,398 billion on its board by end June 2019.

The FBR’s dismal performance has exposed the country’s vulnerability on fiscal front of the economy and it will remain a headache for the incumbent regime with IMF or without IMF programme.

The Ministry of Finance official spokesman Dr Khaqan Najeeb in his brief comments stated that productive discussions took place with the IMF on all areas including fiscal, energy, structural reforms and monetary policy.

“The two sides exchanged views on the data. The discussions were part of regular ongoing interaction with the IMF and will continue in coming weeks as well,” he concluded.

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