Miftah says no more hurdle in getting IMF loan
ISLAMABAD – Federal Minister for Finance and Revenue Miftah Ismail on Friday said that Pakistan and International Monetary Fund (IMF) would soon reach an agreement for reviving the loan programme, as there is no further hurdle in it after the government has taken all tough decisions.
Addressing a press conference along with Chairman Federal Board of Revenue Asim Ahmed, the Finance Minister said that IMF has sent the draft of Memo randum of Economic and Financial Policies (MEFP) to Pakistan a couple of days back. The government has forwarded the different portions of MEFP to the relevant ministries including power, petroleum and others for their input. He further said that the government would finalize the MEFP after discussing it in details. There would be no hurdle in finalizing the agreement, as the government has already taken tough decision, he added.
Miftah Ismail said that inflation has increased in the country mainly due to the hike in oil products prices. However, he clarified that there was no other option for the government than to increase prices. There were two options with the government either to let the country default by not increasing oil prices or to enhance the prices to stabilize the economy. The incumbent government for the first time has charged petroleum levy up to Rs10 per liter, which is still lower than PTI’s agreement with the IMF. He informed that the government would charge petroleum levy and General Sales Tax of Rs75 per liter on petrol and Rs81 per liter on diesel as per agreement of the PTI government with the IMF. However, the government is charging only Rs10 per liter on petrol and Rs5 per liter on diesel.
Talking about the tax collection, the Finance Minister said that Federal Board of Revenue (FBR) has exceeded its tax collection target by Rs20 billion in the last fiscal year. Earlier, he said that the government was excepting that tax collection would reach Rs6.05 trillion as against the target of Rs6.1 trillion. However, the FBR has exceeded the target. He appreciated the Federal Board of Revenue for collecting a record amount of tax worth Rs763 billion in the last month. Tax collection has shown an increase of 32 percent in tax collection in June. Tax collection had never exceeded Rs600 billion benchmark in any month in the past, as the previous higher collection in June was Rs580 billion. He further said that the government has also paid massive refunds in last month. The Minister said refunds worth Rs39 billion have been issued during the last month, recording an increase of 44 percent as compared to that in last year.
He further said during the 4th quarter of outgoing financial year since PML-N led allied government took over, the tax collection remained Rs 1741 billion, which is 29 percent more than that of last year’s same period. He further said that FBR has collected Rs389 billion as income tax during last month, recording an increase of 45 percent. He said no advance tax was taken last month to achieve tax collection target.
The Chairman FBR said that it was tough challenge for the FBR to achieve the target after facing Rs40 to Rs45 billion monthly shortfall by charging no General Sales Tax on oil products. However, the FBR has improved its enforcement and administration, which helped in generating additional revenue of Rs250 billion. He further said that FBR has added additional taxpayers into the tax net. The government would utilize the technology for broadening of tax base of the country.