We have agreed with IMF to take additional taxation measures of Rs 215 billion: Ishaq Dar  

ISLAMABAD, June 24 (SABAH): Minister for Finance and Revenue Senator Mohammad Ishaq Dar has expressed the confidence that the ninth review with the International Monetary Fund (IMF) under the extended fund facility will soon be concluded.

Winding up discussion on the budget 2023-24 in the National Assembly on Saturday, Ishaq Dar recalled that the country demonstrated complete compliance on all prior actions but due to the gap on external financing, it could not be materialized. He, however, said Prime Minister Mian Muhammad Shehbaz Sharif held two meetings with the Managing Director of IMF in Paris recently during which it was agreed that both the sides will make a last ditch effort to complete the pending review.

The Finance Minister said both sides held consultations over the last three days. He said we have agreed to take additional taxation measures of 215 billion rupees, clarifying that it will not burden the poor people. Similarly, he said we have agreed to reduce current expenditures by 85 billion rupees.

He made it clear that this reduction will not affect the annual development plan as well as salaries and pensions of government employees. He said the IMF has agreed to our stand.

The Finance Minister said we believe in complete transparency and that is why the details of the meetings with the IMF are being shared with the public.

He said once the agreement is reached with the IMF, it will also be uploaded on the website of the finance ministry.

Ishaq Dar said as a result of the understanding reached with the IMF, he said the annual FBR tax collection target is being enhanced from 9200 billion rupees to 9415 billion rupees.

The total outlay of the budget will now be 14480 billion rupees.  He was confident that these measures will also help reduce the fiscal deficit.

Ishaq Dar said the federal government has introduced a number of changes to its fiscal year 2024 budget in a last-ditch effort to clinch a stalled rescue package with the International Monetary Fund (IMF). “Pakistan and IMF had detailed negotiations as a last effort to complete the pending review,” he said.

Ishaq Dar said that for the past few months, the nation was questioning whether the IMF’s ninth review would be successful or not, adding that he wanted to take the people into confidence on the matter.

He said the government had completed all prior actions and achieved compliance on the Fund’s demand but Pakistan’s case could not be put in front of it due to the external financing gap.

Ishaq Dar said that it was decided between Pakistan and the IMF for a “last final push” to move the review forward, following which detailed negotiations were held with an IMF delegation in the last three days to complete the ninth review.

The finance minister said the suggestion for Rs215bn in new taxes came about as a result of the talks, adding that care was taken that the tax burden would not fall on the poor and weak segments.

He further said the Rs85bn spending cut would also be achieved without any curtailment in the federal development budget or the salaries and pensions of government employees.

Providing updated figures for the FY24 budget, Ishaq Dar said the revenue collection target for the Federal Board of Revenue was increased to Rs9,415bn from Rs9,200bn. The share of the provinces would be increased to Rs5,399bn from Rs5,276bn. The target for the federal government’s total expenditure was increased to Rs14,480bn from Rs14,460bn. “Due to all of the above measures, there will be an improvement in the overall budget deficit,” Dar said.