IMF 'proposes' Rs 15tr tax target for Pakistan in next budget

ISLAMABAD: The International Monetary Fund (IMF) has proposed a tax target of over Rs 15 trillion for Pakistan in the next budget, ARY News reported citing sources.

According to sources, the IMF and Pakistan are holding virtual talks, with 85% of the discussions completed successfully. The talks are focused on finalizing the details of the next budget, which is expected to be presented in the National Assembly soon.

The new budget is expected to increase the tax-to-GDP ratio to 13% and collect Rs 2,745 billion in non-tax revenue. The government is also expecting the economy to grow by over 4% in the next fiscal year, driven by increased investment and consumption.

Earlier, the IMF urged Pakistan’s Special Investment Facilitation Council (SIFC) to refrain from granting tax exemptions to international investment projects, including the Chaghi-Gwadar railway track project worth $2 billion.

According to sources, the IMF delegation maintained that tax exemptions for international investments would hinder the country’s revenue generation.

The government had requested Gulf countries to invest in the Chaghi-Gwadar railway track project, but the IMF has refused to grant tax exemptions to the SIFC for international investments. The SIFC has been providing a platform for investment and facilitating the transportation of minerals from Reko Diq to Gwadar through a new railway line.

Briefing the IMF delegation, officials stated that a platform is being provided to facilitate investment, and a new railway line will be constructed to transport minerals from Reko Diq to Gwadar.