IMF asks Pakistan to 'do more' for tax collection, seeks privatisation plan
Business
Recommends establishment of a tax policy unit in Ministry of Finance
ISLAMABAD (Dunya News) – The International Monetary Fund (IMF) has asked the Pakistani authorities to 'do more' besides doing away with the special tax system for the construction sector.
The Fund directed the Pakistani authorities to revoke tax exemption for non-profit organisations and re-examine the tax incentives given to the charities.
The IMF demanded withdrawal of tax collectors and the cabinet members’ discretionary powers.
According to sources, the IMF demanded enhanced cooperation from the provinces for the collection of taxes from the federation and the implementation of provincial tax laws. It also recommended establishment of a tax policy unit in the Ministry of Finance.
It was recommended that a comprehensive data transfer system between the Federal Board of Revenue (FBR) and other institutions must immediately be set up.
The IMF team was briefed that a new banking model had been introduced for payments to 9.3 million people under sponsorship programme.
Meanwhile, the IMF also asked for a plan on the privatisation of PIA and other state-owned enterprises.
Stand-By Arrangement (SBA) review
On Thursday, the International Monetary Fund (IMF) praised Pakistan for the steps taken to bring economic stability to the country, but at the same time, called for adopting even stricter policies to achieve the ultimate goal.
The advice came as an IMF delegation started the final review process of the current $3 billion Stand-By Arrangement (SBA) which will pave the way for the release of the remaining amount $1.1bn for the cash-starved country.
IMF Mission Chief Nathan Porter is leading the Washington-based institution’s team which arrived at the Ministry of Finance as part of the four-day stay in the federal capital.
The first day of the IMF review started with Finance Minister Muhammad Aurangzeb, State Bank of Pakistan (SBP) Governor Jameel Ahmad and Federal Bureau of Revenue (FBR) Chairman Malik Amjad Zubair Tiwana briefing the visiting team on different aspects of the current situation and shared the government priorities.
Later, the IMF team left the ministry after attending the preliminary session as the two sides will hold multiple rounds of talks till March 17.
During the briefing, the Pakistani side assured the IMF of meeting the revenue generation target set for the current fiscal year without introducing any new taxes, as the FBR chairman shared a plan on the subject.
