FinMin says IMF has no issues with Pakistan providing targeted subsidies

WEB DESK: Finance Minister Muhammad Aurangzeb stated on Tuesday that the International Monetary Fund (IMF) has no issues with the government providing targeted subsidies.

Speaking to journalists, he explained that these subsidies could be distributed to eligible individuals through the Benazir Income Support Programme (BISP).

According to Business Recorder, Aurangzeb mentioned that to ensure a uniform approach across the country, discussions will be held with provincial chief ministers this week to establish a consistent national policy.

He also said that the federal finance secretary would work closely with provincial secretaries to create a comprehensive financial package that involves both the federal and provincial governments.

On the matter of external financing, the minister revealed a $2 billion gap, noting that negotiations are in advanced stages to secure the necessary funds.

He highlighted the importance of securing agreements for commercial loans, stressing that while the loans themselves are not yet being issued, discussions for debt rollovers are progressing well, with positive updates expected from institutions in allied countries.

Regarding tax policies, Aurangzeb assured that the Federal Board of Revenue (FBR) is on track to meet its tax collection targets through improved digitalisation and enforcement efforts. He emphasised the importance of everyone in society paying their fair share of taxes, as this is crucial for the country’s development.

In response to a question about withholding taxes, the minister clarified that there are no plans to increase them at the moment. He also addressed concerns about income tax on traders, stating that any reduction in this tax would necessitate collecting more from the salaried class and the manufacturing sector.

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