Pakistan 'seeks' IMF approval for new tax

ISLAMABAD: The Pakistan government has requested the International Monetary Fund (IMF) to allow the imposition of a new tax through a mini-budget, ARY News reported on Friday, citing well-informed sources.

According to insiders, the proposed levy—likely to be introduced via a money bill—would be a municipal tax aimed at financing the construction of the Jinnah Medical Complex in Islamabad.

The Pakistan government has already initiated groundwork for the tax amid fears of another mini-budget.

Officials revealed that the medical complex is estimated to cost Rs213 billion, with the project scheduled for completion in three years.

However, financial constraints have prompted the government to explore alternative funding avenues. The IMF, meanwhile, has sought further details on Pakistan’s request for a new tax, the sources said.

Sources added that the government is considering releasing Rs30 billion from emergency funds for immediate requirements, while Federal Minister Ahsan Iqbal indicated that external financing outside the Public Sector Development Programme (PSDP) could also be pursued.

Alternative funding options under review include supplementary grants, diversion of funds from other projects, and the potential allocation of returns from $76 million worth of Panda bonds. The Ministry of Finance is also pushing to integrate the project into the PSDP framework.

So far, Rs3.5 billion has been allocated to establish the Jinnah Medical Complex Company and initiate staff recruitment.

Meanwhile, the International Monetary Fund (IMF) team will visit Pakistan from September 25 to October 08 for the second economic review under the Extended Fund Facility (EFF), sources said.

“The sides will first hold technical talks and then policy level dialogue,” according to sources.

The delegation will hold talks with the ministries of finance, energy, planning, the State Bank of Pakistan, FBR, OGRA, NEPRA and other institutions and ministries.