Aisha Ghaus Pasha, Minister of State for Finance, stated that the country’s future is to remain in the International Monetary Fund (IMF) plan and that the Finance Division and the Federal Board of Revenue (FBR) are continually engaged with the Fund.
This was said by the minister of state after the Senate Standing Committee on Finance met on Wednesday, which was headed over by Saleem Mandviwala.
She went on to say that the administration is attempting to reach an agreement and that the Prime Minister has consistently stated his desire to remain in the IMF plan. She stated that the administration has achieved significant progress on the IMF programme and does not want to detract from it.
Pasha stated that the Finance Division and the FBR are continually engaged with the IMF and do not wish to deviate after incurring significant political expenses and making sacrifices on behalf of the people. She stated that the government wishes to continue with the IMF programme and that negotiations with the Fund are ongoing.
She stated that the largest relief for the people in the next budget would be to limit the budget deficit because avoiding more loans would be the best relief because borrowing to finance the deficit would fuel inflation even more.
According to the minister of state for finance, inflationary expectations of borrowing are so established and deep-rooted that they cannot be simply eliminated. Despite the severe economic circumstances, the government will attempt to provide relief to the extent that there is no additional cost to the people.
Pasha goes on to say that budget preparations are underway and that the macroeconomic framework is being developed as budget numbers are finalised. She also stated that the budget figures are being finalized. The government expects to present the budget for the new fiscal year in the first week of June, although the exact date has yet to be determined.
The minister stated that an increase in the tax-to-GDP ratio is vital and bemoaned the fact that the FBR tax-to-GDP ratio is even in the single digits. She stated that the government’s objective is to broaden the revenue base by regulating smuggling and bringing the informal economy into the tax net.