IMF asks Pakistan to 'increase' gas prices
- By Shoaib Nizami -
- May 22, 2024
ISLAMABAD: The International Monetary Fund (IMF) has asked Pakistan to increase gas prices as part of its negotiations for the new loan program, ARY News reported citing sources.
According to sources, the IMF has proposed a gas price hike for domestic, fertilizer, CNG, and cement sectors from August, with an increase of Rs 100-400 per month for protected and non-protected consumers.
However, the IMF suggests no gas price hike for commercial users, including tandoors.
To reduce circular debt in the gas sector, three plans have been shared with the IMF, and discussions have also taken place on a dividend scheme to achieve this goal, sources added.
Additionally, the IMF has proposed a gas price hike for fertilizer plants.
Sources further added, an agreement has been reached on sharing data on subsidies, reforms, and tariffs with the IMF in a timely manner.
Earlier, the International Monetary Fund mission demanded Pakistani authorities to impose tax on monthly pensions exceeding Rs 100,000.
Prior to this demand, the IMF mission ‘asked’ Pakistani authorities to increase general sales tax (GST) to 18 percent.
IMF mission observed that the Pakistan’s sales tax collection system is facing problems as the centre is collecting sales tax on the commodities, while the provinces on the services.
They suggested sales tax collection should only be done by the federal government. The international lender also demanded to end GST exemption and increase it to 18 per cent on the commodities and service, the sources said.
READ: IMF asks Pakistan to ‘impose’ tax on monthly pensions
During the fourth round of talks, the mission also demanded of Pakistan for reforms in the Insurance Sector and formation of a separate regulatory body. The fund also demanded privatisation of three government-owned insurance companies.
The International Monetary Fund delegation is currently in Pakistan as Islamabad is interested in taking another programme from the international lender to address the finance shortage.