Islamabad May 7 2024: IMF mission will come to Pakistan in the next 7 to 10 days in which the future program will be discussed, says Finance Minister.
During a press briefing in Islamabad, Finance Minister Muhammad Aurangzeb, accompanied by federal ministers Atta Tarar and Azam Nazir, underscored the imperative of bolstering the nation’s tax-to-GDP ratio, emphasizing that sustainable governance hinges on robust tax revenues rather than benevolence. He questioned the feasibility of maintaining a functioning state with a mere 9 percent tax-to-GDP ratio, asserting that while charitable endeavors can support specific initiatives like schools and hospitals, the fundamental operations of the country rely squarely on tax revenue.
Expressing bewilderment at the discontent among foreign investors over the SIM card ban, the Finance Minister suggested that individuals capable of affording hefty mobile bills should also fulfill their tax obligations, advocating for a more equitable and stabilized tax regime. He highlighted the necessity of broadening the tax base beyond the affluent class, citing the imposition of a 50,000 tax bracket on high-income earners as a step towards this end.
Aurangzeb reiterated the importance of Pakistan’s engagement with the International Monetary Fund (IMF), noting the forthcoming visit of an IMF mission to chart a course for future collaboration. Addressing economic concerns, he acknowledged the current inflation rate of 17%, expressing optimism for its gradual reduction alongside an anticipated decline in policy rates by July-August. Emphasizing the imperative of curbing non-development expenditures, he outlined plans for pension reforms and infrastructure enhancements, including the ongoing digitalization efforts within the Federal Board of Revenue (FBR).
Prime Minister Nazir Tarar emphasized the nexus between political stability and economic prosperity, highlighting ongoing discussions surrounding pension reforms aimed at alleviating the strain on public finances caused by retiree pensions. Information Minister Atta Tarar announced the formation of a committee tasked with spearheading pension reforms and ensuring transparent communication with the public regarding proposed changes.
