IMF Praises Pakistan's Economic Measures In Budget For FY2024-25

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IMF praises Pakistan's economic measures in budget for FY2024-25

The International Monetary Fund appreciates restriction of tax exemptions aimed at improving the economy.

ISLAMABAD: (UrduPoint/Pakistan Point News-June 22nd, 2024) The International Monetary Fund (IMF) praised Pakistan's stringent economic decisions in the budget for FY2024-25, the sources close to the development said on Saturday.

The sources said that there was a significant progress in the virtual talks between Pakistan and the IMF. The IMF expressed satisfaction with the tough economic measures taken in the budget, acknowledging the constructive role of political parties in its formulation.

Besides it, the IMF appreciated the restriction of tax exemptions aimed at improving the economy. Sources noted that an IMF delegation is expected to visit Pakistan for discussions on a new loan program in the last week of June, as the country has met the prior conditions.

The IMF anticipates that the budget for the upcoming financial year will be approved by June 28 or 29, according to sources.

Earlier, Finance Minister Muhammad Aurangzeb presented Pakistan’s budget for the fiscal year 2024-25, with a total outlay exceeding Rs18 trillion, amid protests from opposition lawmakers belonging to Pakistan Tehreek-e-Insaf (PTI)-backed Sunni Ittehad Council.

The federal government proposed eliminating sales tax exemptions and concessions on various items, including mobile phones, copper, coal, paper, and plastic scrap.

In his budget speech to the National Assembly, Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb proposed a standard sales tax rate of 18 percent on these items.

The government also proposed increasing import duties on luxury cars valued over $50,000 and on steel and paper products. The 18 percent sales tax would apply to mobile phones, copper, coal, paper, and plastic scrap, as outlined in the budget proposals.

The IMF had demanded increased tax collection from provinces, the imposition of taxes on agriculture, stationery items, monthly pensions and hikes in gas and electricity prices, along with a general sales tax increase to 18 percent.

Abdullah Hussain

Abdullah Hussain is a staff member who writes on politics, human rights, social issues and climate change.