ISLAMABAD: Pakistan has secured significant relief from the International Monetary Fund (IMF) ahead of the federal budget, with Prime Minister Shehbaz Sharif successfully convincing the lender to ease several proposed fiscal measures, according to sources.
Prime Minister Shehbaz Sharif briefed IMF Managing Director Kristalina Georgieva on the economic challenges facing the country and the hardships being endured by the public, leading to flexibility on a number of key budget proposals.
Sources said the IMF has agreed to provide relief to the salaried class, with the prime minister securing an estimated Rs60 billion in tax relief for salaried individuals.
The IMF has also reportedly agreed to increase stipends under the Benazir Income Support Programme (BISP), a move expected to provide additional support to low-income families across the country.
In another major development, the IMF has withdrawn its pressure to impose an 18 percent sales tax on solar panels and stationery items.
Pakistan govt’s proposals to maintain a lower tax rate on solar panels are currently under consideration, with sources indicating that a 10 percent sales tax on solar panels may remain in place in the upcoming budget.
The prime minister also secured relief for students and parents, as authorities are unlikely to impose the proposed 18 percent sales tax on stationery products.
Sources further said there is little likelihood of any major changes to the existing tax structure for the stock market and tobacco products in the forthcoming budget.
The developments come as Pakistan and the IMF conclude key budget discussions ahead of the announcement of the federal budget for the next fiscal year.
