ISLAMABAD – The International Monetary Fund (IMF) has urged Pakistani authorities to implement additional measures beyond eliminating the special tax system for the construction sector.
The IMF also asked the government to end tax exemptions for non-profit organizations, review tax incentives for charities and abolish the discretionary powers of tax collectors and cabinet members.
The IMF also stressed the need for enhanced cooperation from provinces in tax collection and enforcing provincial tax laws, along with establishing a tax policy unit in the Ministry of Finance.
The mission also recommended the immediate establishment of a comprehensive data transfer system between the Federal Board of Revenue (FBR) and other institutions.
The IMF praised Pakistan for steps toward economic stability but advised stricter policies.
The IMF delegation, led by Mission Chief Nathan Potter, commenced the final review process of the $3 billion Stand-By Arrangement (SBA), aiming to release the remaining $1.1 billion.
Pakistani officials including Finance Minister Muhammad Aurangzeb, SBP Governor Jameel Ahmad and FBR Chairman Malik Amjad Zubair Tiwana briefed the IMF team on the current situation and the government priorities.
The talks will continue until March 17, with Pakistan assuring the IMF of meeting revenue generation targets for the fiscal year without introducing new taxes as outlined by the FBR chairman.
