ISLAMABAD: The IMF review mission is scheduled to hold a meeting with Pakistan Business Council (PBC) on Friday (today) in Karachi to listen to their viewpoint on the economic policies pursued by the government and their expectation from the upcoming budget for 2026-27.
Pressure has been mounting on Minister for Finance Muhammad Aurangzeb from all sides especially from the political masters to convince the IMF for showing a lenient attitude, allowing Islamabad to move towards doling out a stimulus package to kick-start the sluggish economic activities from the next budget but this objective cannot be achieved without rationalisation of tax rates and slashing further both electricity and gas tariffs.
The Fund staff hinted at the adoption of a gradual approach after the representatives of Overseas Chambers of Commerce and Industries (OICCI) in a meeting with the review mission in Karachi on Thursday asked the IMF to reduce the tax burden on the formal sector in the upcoming budget. The IMF side apprised the delegation that the broadening of tax base was the requirement of the country to improve fiscal framework because the country’s financial requirements are mounting. Without broadening of tax base, the wish of rationalising the tax rates may not be possible. They also raised the issue where certain sectors are not contributing into national kitty at all despite making profits.
The IMF side hinted for adoption of gradual approach arguing that the tax rates cannot be reduced in one go so the phased wise approach may be adopted whereby the rates of the super tax may be reduced gradually starting from the upcoming budget.
