Pakistan has managed to finalise its budget in agreement with the demands of the IMF, said Secretary Finance Imdadullah Bosal on Tuesday.
Addressing a post-budget press conference in Islamabad alongside the Finance Minister, Bosal revealed that the IMF has accepted Pakistan’s request not to impose taxes on the agriculture sector, a move he described as a “major achievement” for the government, reports Samaa TV.
“The tax on fertilisers and agrochemicals was originally scheduled for the last fiscal year (2024),” Bosal said.
“But under the Prime Minister’s directive, we negotiated with the IMF to defer it. This year, we were committed to imposing the tax, yet we managed to secure another exemption.”
Bosal further emphasised that the benefits of the federal government’s ongoing “right-sizing” efforts aimed at optimising public sector efficiency would become evident in the future.
The IMF had instructed Islamabad to impose stringent reform conditions for stabilising its debilitating economy, such as broadening its tax base and fiscal consolidation.
The body further called for the taxation of its agricultural sector, which has historically been undertaxed. While a strong contributor to its treasury, the country’s farming has all but crumbled in recent years due to droughts, excessive prices on grains, and corruption.
The issue of taxation has been a recurring point of contention Pakistan’s negotiations with the global money lender, with the current development signifying a continuation of its ongoing fiscal challenges and negotiations, as Islamabad grapples with both monetary challenges and socio-political instability.
