Dar informs National Assembly: No new tax on agriculture, real estate sectors

ISLAMABAD: Federal Minister for Finance and Revenue Muhammad Ishaq Dar said that the government would not impose further taxes on agricultural and real estate sectors in the wake of $3 billion loan as part of the nine-month Stand-by Arrangement (SBA) with the International Monetary Fund (IMF).

The finance minister expressed these views, on Friday, while assuring the Lower House of the Parliament. He said this after many newspapers reported that new taxes would be introduced on the agriculture and construction sectors due to “strict conditions” put forward by the IMF. “I am giving a categorical statement here that not even a single new tax will be imposed: neither on agriculture nor on construction sectors,” he said.

The finance minister made it clear that the government has already delivered on the IMF’s ‘prior actions’ and announced taxation measures of Rs215 billion in additional taxes and expenditure cuts of Rs85 billion in the winding-up budget speech.

Additional revenue: Govt committed to targeting agri and construction sectors

He said that the country’s foreign exchange reserves have reached $ 14 billion as a result of the government’s efforts. He said that a total of $ 8.7 billion are in possession of the State Bank of Pakistan and $ 5.3 billion are held by the commercial banks.

Ishaq Dar said it is our effort to bring down the inflation. He said that according to the State Bank of Pakistan, inflation will come down to seven percent in the coming two years if the consistency in policies continued. “No further burden will be passed on to the people.

All the commitments made with the IMF are on the Finance Ministry’s website,“ he said. The finance minister also placed documents before the House pertaining to the SBA reached with the IMF. He said that the documents would also be available on the Finance Ministry’s website.

The minister said this while explaining the reason behind the government signing a new agreement instead of completing the IMF’s ninth review, which ended on June 30.

He said that if the ninth review had been continued, “there could not be a further extension in this programme”, and while the country would have secured $1.1 billion, the $1.4 billion due in the 10th and 11th IMF reviews would have been lost.

He said that the government “tried that the $1.4billion is not lost” and the amount is received under a new programme. The minister further said that the government aimed to secure a pact with the IMF worth $3.5bn instead of $2.5bn, but then the two parties mutually agreed on $3bn.

Referring to the $ 3 billion SBA reached with the IMF and the financial assistance extended by Saudi Arabia and the UAE, he said we have made all the external payments in a timely manner. He said that the payments worth $2 billion were received from Saudi Arabia and $1 billion from the United Arab Emirates earlier this month. He said that it will be our effort to further enhance our foreign exchange reserves.

Copyright Business Recorder, 2023