Pakistan has assured the International Monetary Fund (IMF) of its commitment to addressing missed fiscal targets and achieving subsequent benchmarks under the 37-month, $7 billion programme.
Finance Minister Muhammad Aurangzeb conveyed this assurance during a meeting with IMF Resident Representative Mahir Binici. In the meeting, the minister acknowledged previous slippages, including missed targets on revenue collection, debt maturity, and provincial tax legislations, as briefed to the National Assembly’s Standing Committee on Finance earlier.
He emphasized that Pakistan is determined to complete the IMF programme successfully, promising a smooth day-to-day consultation with the IMF.
Secretary Finance Imdadullah Bosal informed the parliamentary committee that Pakistan had missed first-quarter revenue targets, delayed provincial legislative actions for agricultural income tax (AIT) reforms, and failed to meet debt maturity benchmarks for the period ending in September and October.
These lapses have raised concerns within the IMF, prompting intensified consultations between the federal and provincial governments.
The federal government is urging provinces to accelerate tax reforms, including aligning AIT with federal income tax regimes and transitioning the General Sales Tax (GST) on services from a positive list to a negative list by FY26.
Provinces are also expected to implement property tax measures, narrow compliance gaps, and expand their revenue bases.
Additionally, provinces are being asked to contribute to federal responsibilities such as higher education, health, social protection, and public infrastructure investment, in line with the 18th Amendment. Federal and provincial governments have also committed to gradually increasing health and education spending as a share of GDP.
The minister reiterated the government’s focus on maintaining the credibility and trust rebuilt over the past 14 months. “The trust and credibility we have regained must be maintained to lay the foundation for inclusive and sustainable growth,” he stated.
The meeting between Pakistan and the IMF also explored solutions to overcome missed targets and emphasized the importance of collective efforts to meet macroeconomic and structural reform goals.
