IMF Agrees to Lower Pakistan’s Tax Target for Current Fiscal Year

The International Monetary Fund (IMF) has agreed in principle to reduce Pakistan’s tax collection target for the current fiscal year by Rs. 160 billion, according to official sources familiar with the ongoing review talks. Under the new understanding, Pakistan will be required to collect Rs. 13.971 trillion in taxes, down from the original target of Rs. 14.131 trillion. However, sources say the final approval for the revised target will rest with the IMF Executive Board. The draft Memorandum of Economic and Financial Policies (MEFP) has been shared with Pakistan’s economic team, and officials are optimistic that an agreement will be reached once the IMF is assured of Pakistan’s commitment to the MEFP. Finance Ministry officials described the two-week negotiations as positive and constructive, with key targets finalized before the IMF delegation’s departure. They expressed hope that the second review of the loan program will be completed successfully, paving the way for the release of a $1.2 billion tranche to Pakistan. Both sides have agreed to continue virtual discussions to finalize the agreement. The Finance Ministry said talks with the IMF so far have been “constructive and positive,” and that the government remains hopeful of a successful outcome.