IMF, Pakistan, tax revenue mobilization, Pakistan, IMF Pakistan

IMF wants Pakistan government to collect more taxes from people

The International Monetary Fund (IMF) Mission Chief for Pakistan Ernesto Ramirez Rigo has expressed to see more tax revenue mobilization, but admitted that the area is ‘very tough’ with many political economic issues.

“On the fiscal side, I think it’s an area where we will have to employ more of our time in the months to come. It’s an area where it’s not just about the improvement on the total — on the headline number on the fiscal headline number, it is about the quality.

“But we want to be very mindful to minimize the impact of the adjustments on economic growth, this is why we also put the emphasis on tax revenue rather than expenditure, which normally comes with larger multipliers,” said Ernesto, in a transcript of the Conference Call on the Release of the IMF Staff Report on the First Review under the Extended Fund Facility Arrangement for Pakistan.

“We calibrated that very carefully, but we want to see more tax revenue mobilization, and that’s an area which is not easy, it’s very tough, there are many political economic issues around that.

And that’s where we think it’s an area of concern that we should continue to make progress there,” he said.

Meanwhile, Ernesto said that they have seen ‘major improvement’ in the external position of Pakistan that was one of the objectives of the program, and a very smooth transition to market-determined exchange rate, it was also a major component of the program. “So those are areas where we feel that the program is delivering very good early results,” he said.

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