ISLAMABAD: Prime Minister Shehbaz Sharif has called for the swift finalization of a $1.2 billion Saudi loan and directed the Federal Board of Revenue (FBR) to present a detailed plan this week to address a substantial tax collection shortfall, ensuring the continuation of the IMF programme.
During a meeting on the outcomes of the recent IMF delegation visit, Shehbaz was informed that while most conditions were on track, unresolved issues such as the tax shortfall, external financing gap, and the National Fiscal Pact implementation required urgent action.
Express Tribune reported, citing sources, that Pakistan has listed $1.2 billion oil on deferred payments by Saudi Arabia as part of its financing plan to bridge this year’s IMF estimate of $2.5 billion gap. Finance Minister Muhammad Aurangzeb is tasked with following up on the matter.
The FBR has suffered a PKR190 billion tax shortfall within the first four months of the fiscal year, which its chairman attributed to incorrect assumptions. The prime minister directed the tax authority to formulate an enforcement plan to address the shortfall and meet the IMF’s November target of PKR1.03 trillion.
The PM’s Office also stated that Shehbaz urged strict action against tax evaders, emphasizing accountability for those enabling tax theft. Additionally, the PM was briefed on IMF demands to disconnect gas supplies for in-house power generation by industries, which the government seeks to reconsider, given the surplus electricity and LNG.
The IMF also presses for the approval of agriculture income tax laws by all provinces, aiming to align rates with federal personal income tax rates of 45%. While Punjab has approved the law, Sindh has yet to present it to its assembly.
The PM acknowledged Punjab’s progress in agricultural reforms and highlighted the overall improvements in economic indicators, with rising exports, record remittances, and increased foreign reserves. He affirmed the government’s commitment to prioritizing public relief and ensuring all sectors contribute their due taxes for national progress.
