Islamabad: The International Monetary Fund (IMF) mission and Pakistani authorities on Monday held discussions on the implementation of agricultural income tax as part of the broader economic reforms linked to the country’s loan program.
Sources in the Finance Ministry confirmed that a special session was held between the IMF team and officials from provincial governments, the Ministry of Finance, and the Federal Board of Revenue (FBR) to deliberate on taxation measures for the agriculture sector. The Fund mission is scheduled to hold further meetings with provincial representatives on Tuesday (March 11).
The talks come as Pakistan seeks to secure the next $1 billion tranche under the $7 billion Extended Fund Facility (EFF). While policy-level discussions were expected to commence on Monday, Finance Minister Muhammad Aurangzeb did not meet with the IMF delegation. Instead, other senior officials engaged with the Fund’s team.
Meanwhile, Sindh has reluctantly approved the Agricultural Income Tax Bill 2025, marking a key development in the discussions on taxing agricultural earnings—an area historically exempt from significant taxation. The IMF has been pressing for broad-based tax reforms to improve revenue collection.
Pakistan is set to submit a comprehensive report detailing the implementation of IMF-mandated conditions and an assessment of the first half of the current fiscal year. The Fund’s staff will review this progress before finalizing recommendations for the IMF Executive Board, whose approval is required for the disbursement of the next loan installment.
The outcome of these discussions will be crucial for Pakistan’s ongoing engagement with the IMF, as the country navigates economic stabilization measures amid fiscal challenges.
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