Finance Minister Muhammad Aurangzeb has stated that the government is prepared to implement strict measures to boost tax collection.
Speaking at a news conference in Islamabad on Sunday, Muhammad Aurangzeb provided details about the recent visit of the International Monetary Fund (IMF) delegation, led by Pakistan mission chief Nathan Porter. He shared that the confidence of international monetary institutions in Pakistan has notably increased following discussions with the IMF.
Contrary to the belief that the Pakistan-IMF talks were conducted in secrecy, the finance minister clarified that the talks were centered on the government’s reform agenda. The IMF praised the government for achieving a surplus in the provincial deficit within just 14 months.
Aurangzeb emphasized the need to bring the real sector into the tax net, alongside the salaried class, and stressed that strict measures will be enforced to raise tax revenue.
The finance minister expressed confidence that the economy is on a path to sustainable growth, aided by government actions that are correcting its course. He also noted a significant increase in Pakistan’s foreign reserves, attributed to a decline in interest rates.
Aurangzeb revealed that Prime Minister Shahbaz Sharif will soon present the country’s economic roadmap to the public.
Following a week-long visit to Pakistan, the IMF issued a statement indicating constructive discussions with Pakistani authorities on economic policies and reforms to reduce vulnerabilities. The IMF urged Pakistan to reduce state intervention, enhance revenue through tax reforms, and implement sound fiscal policies.
While the IMF did not list specific weaknesses, sources from Pakistan’s finance ministry indicated that the IMF had intervened due to a shortfall of nearly Rs 190 billion ($685 million) in revenue collection during the first quarter of the fiscal year. The IMF also highlighted significant losses in the power and gas sectors, stressing the need for structural energy reforms to restore their viability.
Both parties agreed on the importance of continuing prudent fiscal and monetary policies and tapping into untapped tax bases to mobilize revenue.
