The International Monetary Fund (IMF) has requested a comprehensive, output-focused update on Pakistan’s digitalisation initiatives for its revenue system, including the integration of artificial intelligence to broaden the tax base and enhance revenue collection.
The IMF team, led by Pakistan’s mission chief Nathan Porter, met with Finance Minister Muhammad Aurangzeb for an initial session on Tuesday, joined by Minister of State for Revenue Ali Pervez Malik, State Bank Governor Jameel Ahmad, and Federal Board of Revenue (FBR) Chairman Rashid Mehmood Langrial.
According to media reports, the IMF mission is also engaging in separate technical discussions with various stakeholders, including the FBR, energy sector regulators, and the power and petroleum divisions.
However, it remains uncertain if these talks will progress to the policy-level discussions essential for the IMF’s quarterly review process.
The formal review, based on Pakistan’s performance by the end of December, will determine the release of a second $1 billion tranche, expected by March 15, 2025.
During preliminary meetings, IMF officials called for detailed reports on FBR’s digitalisation efforts, particularly in utilizing AI to identify tax evaders and improve tracking of taxable income.
They also sought an update on the progress of the track-and-trace system for better monitoring of revenue streams.
In initial discussions, FBR officials linked recent revenue shortfalls, notably in the early stages of the second quarter, to falling inflation rates.
The IMF team is set to meet with the power and petroleum divisions today to address interconnected issues such as circular debt, planned tariff adjustments, loss reduction measures, and recovery strategies.
