Pakistan, IMF agree not to introduce mini-budget

ISLAMABAD: Pakistan and the International Monetary Fund (IMF) had agreed that there would be no mini-budget or a reduction in the tax collection target, sources told Geo News.

The sources further said Pakistan was not to raise the tax rate until June 2020 or reduce its tax collection target, as talks between Pakistan and the IMF concluded here on Wednesday.

The meeting was chaired by Prime Minister Imran Khan’s Adviser on Finance and Revenue Dr Abdul Hafeez Shaikh and IMF Mission Chief for Pakistan Ernesto Ramirez-Rigo.

However, it was advised that Pakistan bump up its non-tax income by Rs400 billion to boost revenue collection. The country would also ensure implementation of the privatisation road map and not jack up the sales tax to 18 per cent; the rate would, for now, be maintained at 17 per cent.

Sources in the Finance Ministry informed The News that Pakistan, for the most part, had achieved most of the goals the IMF had set for it. The global financial body was also satisfied over the country’s monetary and current account deficits, they added.

The sources mentioned that Pakistan would make adequate efforts to achieve the tax collection target and that a road map to bring down the deficit and losses had been readied. Both parties — IMF and Pakistan — would issue separate notifications pertaining to the 10-day talks, the sources added.