IMF appreciates Pakistan's 'tough decisions' in budget 2024-25

ISLAMABAD: The International Monetary Fund (IMF) on Saturday appreciated Pakistan’s tough economic decisions in budget 2024-25, ARY News reported citing sources.

According to sources, Pakistan and the International Monetary Fund (IMF) have made significant progress in their virtual negotiations.

Sources revealed that the IMF expressed satisfaction over the tough economic decisions taken in the budget, acknowledging the positive role of political parties in the budget.

Sources further added that the limitation of tax exemptions to improve the economy was also appreciated by the monetary fund.

The IMF delegation is expected to arrive in Pakistan for the new loan program in the last week of June, as the country has fulfilled the prior conditions, source added.

Moreover, the IMF expects the budget for the next financial year to be approved by June 28 or 29, sources said.

Earlier, Finance Minister Muhammad Aurangzeb presented Pakistan’s budget for the fiscal year 2024-25 with a total outlay of over Rs18 trillion amid protest by the opposition lawmakers belonging to Pakistan Tehreek-e-Insaf (PTI)-backed Sunni Ittehad Council.

The federal government proposed abolishing sales tax exemptions and concessions on various items including mobile phones, copper, coal, paper, and plastic scrap, ARY News reported.

In his budget speech on the National Assembly floor, Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb proposed a standard sales tax rate of 18 percent on various items.

Read more: Budget 2024-25: How much income tax will be deducted from salaries?

The government also proposed to increase import duties on luxury cars worth over $50,000. The budget proposal also asked the House to increase the import duty on steel and paper products. The 18 percent sales tax would be applied on mobile phones, copper, coal, paper, and plastic scrap, as per the budget proposals.

It is pertinent to mention here that the International Monetary Fund (IMF) had demanded more tax collection from provinces and imposition of tax on agriculture, stationery items, monthly pensions, increase gas, electricity prices and general sales tax to 18 percent.