Finance Minister, Shaukat Tarin, told the Senate standing committee on Finance that the government did not agree to the International Monetary Fund (IMF’s) demand of increasing personal income tax that would add additional revenue of Rs. 150 billion in the next fiscal year.
He stated that he would explore other options to increase revenue collection, adding that he would also acquire fiscal space of 1-2 percent from the IMF to increase spending on health and education.
The minister expressed that the financing gap of $29 billion had left no other option for the government but to go to the IMF and accepted their difficult conditions to increase discount rate, devaluation of the exchange rate, and power and gas tariff increase.
He said that the government will rewrite powers of the Federal Board of Revenue (FBR) with regards to arresting and prosecuting taxpayers involved in income concealment. He said the government had also decided that tax notices would be dispatched through a third party. This move comes as part of the government’s efforts to fulfill the requirements of the IMF’s Extended Fund Facility (EFF) program.