A team of tax experts from the International Monetary Fund (IMF) arrived in Pakistan on Monday to advise the Federal Board of Revenue (FBR) on how to increase tax revenue and broaden the tax base, sources said.
The team will hold a week-long consultation with the FBR on various aspects of the tax policy, including introducing amendments and incentives for retailers, sources said. The aim is to bring 1.5 million people into the tax net by June 2024, while the number of taxpayers will be taken up to 6.5 million by then.
Moreover, third party data and technology would be used to expand the net, the officials said.
The tax policy changes will be implemented by the next budget, according to sources. The consultation will not affect the disbursement of the next loan tranche from the IMF, sources said.
Pakistan is expected to receive around US$700 million from the IMF after the executive board approves the staff-level agreement on December 7, sources said. This will bring the total amount received under the program to almost US$1.9 billion, sources said.
Earlier on November 15, Pakistan reached a staff-level agreement with the International Monetary Fund (IMF) on the first review of a $3 billion Standby Agreement (SBA).
The IMF said in a statement the agreement supports the Pakistani authorities’ commitment to advance the planned fiscal consolidation and accelerate cost-reducing reforms in the energy sector.
The short-term deal also envisages a complete return to a market-determined exchange rate, and pursues state-owned enterprise and governance reforms to attract investment and support job creation while continuing to strengthen social assistance.
