Canada Global(Web News)The watchdog government and the IMF agreed on ‘back-up measures’ until the end of the year in case of deviations from fiscal and monetary targets that threaten the broader objectives of the ongoing $3 billion loan program.
According to the report, technical-level talks between the IMF mission and Pakistani officials will end today, while
formal policy-level talks are likely to begin on Monday, with both sides agreeing on a future course of action. There will be, including bringing the retail sector into the tax net and the real estate sector in case revenue collection falls short of the target.
If the income gap narrows, a fixed tax scheme on retail may be introduced in the first phase, after which the real estate sector will be included through an ordinance that will come into effect from January 1, sources said
. The revenue targets achieved through imports are a concern for the IMF’s mission, as imports have so far fallen short of expectations since the 2023 budget and debt deal were finalized in July. .
If either of these scenarios play out, both the retail and real estate sectors will need to increase their revenue significantly from July 1, 2024.
Sources say that in the current fiscal year, no major problem has come up regarding the reduction of development expenditure at the federal and provincial levels, but the issue of effective implementation of tax on agricultural income is not included in the caretaker government’s agenda due to constitutional limitations.
