ISLAMABAD: Pakistani Finance Minister Muhammad Aurangzeb on Sunday expressed his optimism about reaching a new International Monetary Fund (IMF) bailout package after President Asif Ali Zardari approved the tax-laden budget for the next fiscal year starting from July 1.
The minister told reporters in Islamabad that the IMF programme is very important for Pakistan. “We are taking it forward; it is inevitable. I’m very optimistic that we’ll be able to take it through the finish line for an Extended Fund Programme which is going to be larger and longer in nature,” he said.
The cash-strapped federal government passed a Rs18.9 trillion budget with increased taxes as it sought to reach a new bailout from the IMF.
In the budget, the government has enhanced the taxes on the already burdened salaried class, increased the petroleum levy to Rs70, brought exporters into the normal tax regime and placed new taxes on the real estate sectors to increase the tax collection.
According to experts, the financial blueprint is likely to help the struggling nation unlock a deal with the IMF, but also warned that it could lead to more inflation, which would anger the public.
The finance minister said he completely understands the stress that people from different sectors feel about new taxes. “I completely empathise and sympathise, but we need to work for it,” said the minister.
The finance minister went on to say that he would ensure that the government works to lessen the burden on the masses and businesses in the coming days by improving the management system.
The government, in the budget, has enhanced the petroleum development levy (PDL) by Rs10 per litre — from Rs60 to Rs70 — raising alarm in the public as the petrol prices are already high.
However, the finance minister stressed that the levy was not being imposed immediately, which means that when petrol prices group, the levy would not be increased. He assured the reporters that the Rs70 limit set on petroleum prices, will not be imposed right now.
It is pertinent to mention that Pakistan with over 240 million people only 5.2 million filed income tax returns in 2022.
To increase boost tax collection, the government along with other measures, has blocked mobile phone SIM cards and will now also bar non-filers from travelling abroad.
The finance minister during the interaction said that new sectors would be taxed. He also thanked 42,000 new retailers for registering themselves. He said that non-filers should not exist.
