Ahmed Mukhtar Naqshbandi
ISLAMABAD: Pakistan’s negotiating team on Wednesday found it testing to convince the International Monetary Fund (IMF) mission visiting the country to complete the ninth review of the $7 billion Extended Fund Facility.
IMF placed a lengthy list of “hard-to-do” tasks, including raising taxes and ending subsidies on essential items.
During the second day of talks, it demanded Pakistan introduce new taxes of Rs600-800 billion, but Pakistan showed its willingness for Rs200 billion only. However, the mission was not satisfied, and the issue seemed to remain unresolved for now.
IMF’s demands for annual tax target
In the annual tax target, IMF insisted on increasing the amount to Rs8,300 billion but Pakistan is not ready for this figure also and is trying to settle it at Rs7,470 billion.
IMF demanded that Pakistan gradually end all facilities on sales tax and impose 11 to 17 % sales tax on petrol which is currently zero. The government needed more time on the issue, and it requested the financial body to reconsider its demand.
Moreover, both sides also discussed the preparations for a mini-budget to be presented this month.
