ISLAMABAD: The International Monetary Fund (IMF) is reported to have added new conditions in its ongoing technical negotiations with Pakistan’s Finance Ministry, demanding stricter taxation, higher consumer levies, and tighter fiscal discipline ahead of the upcoming budget.
This comes weeks after the IMF’s “do more” list grew to 75 in April, when the lender attached 11 fresh stipulations to the $7 billion bailout package. Those conditions covered everything from budget approval to energy tariffs, tax audits, and regulatory reforms, underscoring the erosion of Pakistan’s policy autonomy.
In the latest round, officials said Deputy Prime Minister Ishaq Dar’s committee is weighing tax measures worth over Rs400 billion, even as the IMF flagged a Rs683 billion shortfall and insisted provinces fully enforce agricultural income taxation in the new financial year. The mission also urged revisions to economic targets, warning that the 4.2% growth projection is unlikely to be met and the revised tax target of Rs13,989 billion remains difficult.
Energy pricing again featured prominently, with IMF officials pressing that global oil price fluctuations be passed directly to consumers. Petroleum levy collections have already crossed Rs1,330 billion in a month, close to the Rs1,468 billion annual target.
To rein in the deficit, the IMF demanded stricter financial discipline while urging Pakistan to allocate more funds to health, education, infrastructure, and social security. It called for at least 3% of GDP to be spent on health and education, and ruled out any delay or concessions in implementing the National Fiscal Pact.
