Budget talks to take place online after IMF team couldn't arrive
Business
Tax related matters amounting to Rs400bn will be part of deliberations
Budget talks with the IMF will now be held online this week; its team expected to arrive in Pakistan next week
Efforts to be made for reducing tax burden on already weighed down salaried class
Govt to seek relief in taxes for large-scale manufacturing (LSM) industry, construction sector
ISLAMABAD (Dunya News) – The talks between Pakistan and IMF with regard to budget preparation will now take place online as the latter’s delegation could not reach the country as per its schedule on Wednesday (today), Dunya News has learnt.
According to sources, budget talks with the IMF will now be held online this week, whereas the arrival of the delegation of funding agency is expected next week.
Sources said the negotiations on budget preparation were scheduled to be held on Wednesday (today), adding now virtual negotiations will be held this week and the delegation for talks will arrive next week. Budget proposals will be shared with IMF during the online negotiations, the sources said.
The Pakistan’s economic team has completed preparations for giving briefing to the IMF, and its delegation will review budget preparation during online meetings. Ministry of Finance and FBR officials will hold virtual negotiations.
Four days after the International Monetary Fund (IMF) approved the immediate disbursement of about $1 billion to Pakistan under the ongoing Extended Fund Facilty (EFF) and greenlit the arrangement for $1.4bn Resilience and Sustainability Facility (RSF) to fight climate challenges, the talks between the global lender and the Pakistan government are set to take place online this week.
Read more: IMF approves $1bn loan tranche for Pakistan amid economic reforms
The talks, which will continue till May 23, will centre around the upcoming budget.
Both sides will discuss income and expenditure, with the Pakistan government briefing the lender about the tax and non-tax revenue.
Tax related matters amounting to Rs400bn will be part of the deliberations.
According to reports, special sessions will be held to convince the IMF to lessen the tax burden on the already weighed down salaried class.
Furthermore, the government has made preparations to persuade the IMF for relief in taxes for large-scale manufacturing (LSM) industry and construction sector.
FM Aurangzeb hints at giving relief to salaried class in upcoming budget
It is worth mentioning that on April 16, Federal Finance Minister Muhammad Aurangzeb had announced good news for the salaried class, promising relief in the upcoming budget.
While speaking to the media in Islamabad, Aurangzeb stated that a program had been devised to provide relief to the salaried class in the next budget. However, he said the details cannot be shared with the media at this stage, as they would first be presented to the IMF.
He added that tax collection from traders had improved, and the trader-friendly scheme should not be linked to tax collection from traders.
He mentioned that 98% of suggestions for budget preparation had been received from both the public and private sectors, and the government was working jointly with the private sector on the budget proposals.
He also stated that no changes would be made to the budget after July 1, and that the Tax Policy Department will start operating under the Ministry of Finance during this calendar year, adding that a new tax form was being developed that every taxpayer would be able to fill out themselves.
The FM said that Pakistan was going to engage in constructive negotiations with the United States, which was the country’s largest trading partner, saying that a Pakistani delegation would visit the U.S. on the prime minister’s directive, and positive discussions were expected.
He emphasised that efforts were ongoing to ensure economic stability and that steps were being taken to facilitate the business community.
“To boost exports, every sector must play its role. Pakistan has products that can become international brands, and there is a need to promote export-led economic growth,” he added.
Aurangzeb also said that efforts were underway to reduce electricity bills in July or earlier.
“All targets set by the IMF have been met, and he expressed hope that the IMF Executive Board will approve the staff-level agreement in May,” he concluded.
