The International Monetary Fund (IMF) has raised concerns regarding the performance of Pakistan’s Federal Board of Revenue (FBR) and rejected claims that the revenue shortfall has been resolved.
According to sources, talks for a $1 billion tranche are still going on between the Ministry of Finance and the IMF mission. Express News said Thursday that the IMF mission met with a team headed by Federal Finance Minister Mohammad Aurangzeb to discuss new tax targets.
Throughout the conference, the administration gave a briefing on cost-cutting initiatives and public institution integration, including institution mergers and job eliminations that saved Rs17 billion.
Notwithstanding these initiatives, the IMF questioned FBR’s ability to manage the revenue gap and disregarded Pakistani officials’ assertions that the problem had been resolved.
The group also discussed the potential of a “golden handshake,” which might result in the termination of thousands of lower-grade jobs and 700 positions in grades 17 to 22, as well as the rightsizing of government personnel.
Sources also mentioned that amendments to the Civil Servants Act are being considered to facilitate the removal of excess government employees. A plan to cut spending and deal with the revenue deficit was also offered by the Ministry of Finance.
Pakistan’s proposal for tax breaks for foreign investment projects was previously denied by the IMF.
