ISLAMABAD – Pakistan held important discussions with the IMF team fromWashington, DC, on video conference.
Discussion were held over the proposed mini-budget and partial withdrawalof tax incentives, imposition of regulatory duties on luxury items andslashing down development outlay in the range of Rs330 to Rs430 billion inthe next week.
The IMF team was briefed by Pakistani authorities that the governmentplanned to take additional taxation measures of Rs100 to Rs125 billionthrough proposed changes in the Finance Act 2018 and imposition ofadditional customs duty as well as slapping increased regulatory duty onimport of luxury items.
Some income tax exemptions might be withdrawn but so far no final decisionwas made on it. The FBR’s tax collection target would also be reviseddownward from Rs4,435 billion to Rs4,300 billion-4,325 billion for thecurrent fiscal year 2018-19 against the collection of Rs3,842 billion forthe last fiscal year 2017-18.
The FBR has convinced the Finance Ministry that the envisaged target ofRs4,435 billion was based on the projection of last year collection atRs3,935 billion but the actual collection stood at just Rs3,842 billion sothe tax machinery argued that without taking additional taxation measuresit could collect Rs4,200 billion maximum.