Islamabad: Adviser to the Prime Minister on Finance Shaukat Tarin on Monday (November 21) announced the introduction of a supplementary budget to meet International Monetary Fund (IMF) requirements, news sources reported. The announcement came after the government and the IMF reached an agreement on the staff level regarding the USD 6 billion Extended Fund Facility (EFF).
According to the press statement, the budget would include a net fiscal adjustment of over PKR 550 billion for the remainder of the fiscal year 2021-22 (FY22). He stated that the government has agreed to make five changes, including a 22% cut in development funds totalling around PKR 200 billion, a PKR 300 billion increase in general sales tax target, a PKR 4 per litre levy on petrol and an audit of Covid-19 funds and the declaration of their beneficial owner. Furthermore, the adviser stated that the government would propose a bill in parliament requesting autonomy for the State Bank of Pakistan (SBP) on matters of monetary policy, exchange rate, and recruitments; nevertheless, the SBP will remain answerable to parliament.
The adviser also said that the government will raise its yearly revenue tax targets from PKR 5.8 trillion to PKR 6.1 trillion of which the Federal Board of Revenue (FBR) has already collected PKR 225 billion in the first 4 months of FY22. It is worth noting that, following the revision of tax objectives and fiscal measures, Pakistan would receive USD 1.059 billion, bringing total EFF disbursements to around USD 3.027 billion.
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