Federal Finance Minister Muhammad Aurangzeb has cautioned that Pakistan will remain reliant on the International Monetary Fund (IMF) unless tax revenues are increased.
In an interview with the Financial Times, Aurangzeb stated, “The upcoming IMF program will not be our last fund program if we don’t bring our tax revenues up.” He expressed optimism about reaching a staff-level agreement with the IMF this month, estimating its value between $6-8 billion.
Aurangzeb highlighted that Pakistan’s dependence on imports has resulted in a recurring cycle of debt and borrowing. He stressed the importance of enhancing the country’s loan repayment capacity.
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The minister also pointed out the lack of trust in the Federal Board of Revenue (FBR) due to issues of corruption and harassment, which deters people from paying taxes.
Aurangzeb emphasized the need for the government to demonstrate positive performance in the next 2-3 months to address Pakistan’s financial challenges. He also noted the IMF’s appreciation for Pakistan’s tough economic decisions, including the recent hike in gas prices.