ISLAMABAD: Pakistan is set to miss the International Monetary Fund’s (IMF) condition to refund Rs75 billion to taxpayers in the first quarter, claimed a report in The Express Tribune.
IMF gave Pakistan the incentive of softening its primary budget deficit reduction target if it conforms to the tax refund condition set by the IMF.
Under the $6 billion IMF loan deal, Pakistan is required to reduce its primary budget deficit to Rs276 billion in the current fiscal year 2019-20 from last year’s level of Rs1.350 trillion.
Against the quarterly target of reducing the tax arrears by Rs75 billion, the Pakistan Tehreek-e-Insaf (PTI) has so far cleared Rs22 billion of the arrears, which are only 30% of the targeted amount, according to figures released by the Federal Board of Revenue (FBR) this week.
According to the report, the government has so far cleared Rs22 billion of the arrears, and if it released the remaining Rs53 billion, it would adversely hit the challenging quarterly revenue target of Rs1.071 trillion, also given by the IMF.
The report said said the FBR’s plan was to release a certain amount of refunds through promissory notes that it issued at a fixed rate of 10%. They said the promissory notes could not be issued at a faster pace due to the banks’ reluctance to accept these notes as collateral.