Default fears deepen but Dar exudes optimism

ISLAMABAD: While assuring that there is absolutely no risk of default, Finance Minister Ishaq Dar, Wednesday assured the business community that the existing compliant taxpayers would not be further squeezed in the upcoming budget (2023-24) and the focus of the budget would be broadening the tax base and document new taxpayers.

Dar also assured tax relief measures such as incentives to the poultry sector to bring the commodity prices down in the coming days.

The minister was responding to a query of representatives from the Rawalpindi Chamber of Commerce and Industry (RCCI) at the Federal Board of Revenue (FBR) to discuss the budget proposals for 2023-24.

Business community held out assurance

The RCCI requested the finance minister that the existing taxpayers are already over-burdened with taxes and should not be further burdened.

Dar opined that the country was not on the verge of a financial crisis and “will absolutely not default.”

The finance minister commended his economic team for its “efforts and hard work,” pointing out that the country had recorded a current account surplus for the months of March and April at $750 million and $18m, respectively.

Regarding the ongoing negotiations with the IMF for the release of the long-awaited bailout tranche, Dar said his team had completed all the technical work and prior actions required for the completion of the ninth review. He stressed that there was a “sincere effort” on his and his team’s part to complete the IMF’s ongoing programme and said the delay was “unfortunate”.

The review should have been completed earlier, he added. Dar said the country had repaid $5.5 billion of its commercial loans. Of those, he said China had rolled over $2bn once it “understood” that Pakistan had completed its requirements for the release of funds by the IMF.

Regarding the rest of the $3.5bn from non-Chinese commercial banks, Dar said: “We are expecting that a substantial part of that [loan] facility will be returned once the [IMF] staff level agreement or board meeting is completed because it is always renewed and they (banks) are always there to do business.”

Dar held a joint meeting with delegations from Rawalpindi, Islamabad, Sarhad Chambers of Commerce on Budget 2023-24 proposals at the FBR (HQ), on Wednesday.

The delegation appreciated the finance minister for inviting the budget proposals from the Chambers of Commerce and discussed the current economic situation of the country.

The delegation gave proposals for the upcoming federal budget in light of various issues being faced by them. They extended their complete support to the government in its efforts to boost the economic and business activities in Pakistan.

Giving a presentation to the Finance Minister, Zahid Latif Khan, who is also Chairman ISE Tower REIT Management Company Limited, said during the last one year, 16 REITs were registered with the SECP and many RETIs are in the pipeline for approval. The government should encourage documentation of the real estate sector and to encourage the REITs schemes, which was welcomed by the finance minister.

Dar welcomed the delegation and shared the economic and financial outlook of the country and expressed the resolve of the government to overcome these challenges and set the economy towards growth.

The finance minister welcomed the budget proposals given by the members of the delegation and assured the business leaders that the government will provide all possible assistance to the business community for economic stability and growth. He further said that the government is working to provide business- and people-friendly budget 2023-24.

The finance minister reiterated the importance of the business community and appreciated their efforts and contribution to the economy of Pakistan.

The delegation thanked the finance minister for considering their budget proposals.

The delegation included Saqib Rafiq, Sohail Altaf, Ahsan Bakhtawari, Aqib Jamil, Shahrukh Khan, Faad Waheed, Khalid Iqbal Malik, Ijaz Abbasi, Mian Ramzan, Najam Rehan, Dr Sarosh, and others.

Meanwhile, a joint delegation of the Islamabad Chamber of Commerce and Industry (ICCI), Rawalpindi Chamber of Commerce and Industry (RCCI), and the Sarhad Chamber of Commerce and Industry (SCCI) called on the Federal Finance Minister Dar today at FBR Headquarters in Islamabad.

The delegation comprised Ahsan Bakhtawari, president ICCI, Saqib Rafiq president RCCI, and other senior members of the three Chambers.

The finance minister was accompanied by Tariq Bajwa, special assistant to the prime minister on finance, Tariq Mehmood Pasha, special assistant to the prime minister on revenue, Ashfaq Tola, chairman Reforms and Resource Mobilization Commission (RRMC), Asim Ahmad chairman Federal Board of Revenue, Imdad Bosal, Secretary Finance and other senior officers from the Finance Ministry and Revenue Division.

The delegation apprised the finance minister and his team about the difficulties being faced by the business community and submitted their proposals for incorporation in the upcoming Federal Budget. They assured the minister that the business community will support the government in achieving exports and revenue targets for the next financial year and contribute to the development of the country.

The finance minister said that the government is always open to implementable and valuable suggestions from the business community as they are the partners in progress. He stated that the government is taking measures to put the country towards the path of progress and prosperity without further burdening the business community and the general public.

Copyright Business Recorder, 2023