ISLAMABAD: The International Monetary Fund (IMF) mission is expected to reach Pakistan by end of February or early March for first review of the $7 billion Extended Fund Facility (EFF) programme. This was stated by Federal Minister for Finance Muhammad Aurangzeb while talking to media here on Wednesday. “No date is confirmed yet for the IMF Mission to visit Pakistan for the first review, but is expected by end February or early March,” said the minister.
According to the IMF report released in October, the proposed schedule for first review under the EFF and end-December 2024 performance/continuous criteria is March 15, 2025.
Briefing the Senate Standing Committee on Finance and Revenue, which met with Saleem Mandviwalla in the chair, Aurangzeb said that the country is in a three-year Fund programme and to stay firm with commitments —made in the programme and few things might have to be phased in the budget 2025-26 and something may be later.
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“We are in and know where we are, what we are committed, and we are going to stay firm with those commitments”, he added.
Aurangzeb also discussed the government’s intention to separate tax policy from the Federal Board of Revenue (FBR) operations in the next financial year. This strategic move aims to enable the FBR to focus solely on its core function of tax collection, thereby, improving efficiency and productivity, he added.
The finance minister once again acknowledged the “disproportionately high burden” on the country’s salaried class. “This is my personal view, that indeed on the salaried class side, there is a disproportionately high burden”, said the minister, adding that the government is aiming to ease the burden on the salaried class. “We are taking steps to keep the tax form simple and easy,” he added, noting that 60-70 percent of employees are not subject to the super tax.
The committee also discussed the possibility of converting certain taxes into a carbon tax. While the finance minister acknowledged the World Bank’s Country Partnership Framework, which includes climate and carbon concerns, some members, including Senator Farooq H Naik, raised concerns about the impact of a carbon tax on inflation and its effect on the poor.
Aurangzeb clarified that there are 1,100 Captive Power Plants out of 56,000 industrial units for which gas prices was increased to Rs3,500.
The committee also stressed the need for reforms to reduce the administrative burden on taxpayers, while ensuring that tax collection remains efficient and fair.
He said that in a departure from traditional budget planning, the government has introduced a more inclusive and transparent process. As part of this new approach, the process has been started in January instead of April and all government departments have been asked to present their budgets, while forums like the PBC and various chambers have been invited to provide inputs.
Briefing the committee about Public Sector Development Programme (PSDP), Finance Secretary Imdadullah Bosal said that there was no new budget proposed for the next fiscal year 2025-26. However, five ongoing PSDP projects of Finance Division would continue during 2025-26, for which, allocation of Rs3.1 billion was proposed.
A significant portion of the meeting centered around the ongoing training programmes for FBR officers, which have been in place for over 20 years. Mandviwalla questioned the effectiveness of these training programmes, asking, “What has been achieved from the training provided to FBR officers?” The committee sought detailed information on the outcomes of these programmes, and Secretary Finance Imdadullah Bosal assured that comprehensive details would be provided to the committee.
Copyright Business Recorder, 2025