Washington: In a move aimed at boosting Pakistan’s tax revenue, Finance Minister Muhammad Aurangzeb has announced new restrictions barring non-filers from purchasing properties and vehicles, signaling a tougher stance on tax compliance. At a press conference in Washington, Aurangzeb stated that the government plans to eliminate the non-filer category. This reform, he noted, is part of a broader strategy to stabilize Pakistan’s economy and improve its tax-to-GDP ratio, which currently stands at 9%. The government aims to raise this figure to 13% in the near term, a critical step for long-term economic stability.
Aurangzeb underscored the necessity of making difficult economic choices, pointing out that recent efforts yielded positive results. Key economic indicators, including inflation and the policy rate, have shown improvement, contributing to greater macroeconomic stability. Notably, he shared that Pakistan’s economic direction has been recognized positively by major rating agencies, highlighting ongoing progress in securing fiscal health.
During discussions in the U.S., Aurangzeb met with representatives from the International Monetary Fund (IMF) and World Bank, conveying confidence that Pakistan’s current IMF program could be its last. Additionally, he disclosed that the World Bank has expressed interest in offering grants to Pakistan rather than traditional loans, underscoring the country’s efforts to reduce its reliance on external debt.
Meanwhile, Pakistan has requested an additional 10 billion yuan ($1.4 billion) from China, intending to increase its currency swap facility from the existing 30 billion yuan ($4.3 billion) to 40 billion yuan, or approximately $5.7 billion in total. This request follows China’s recent extension of Pakistan’s existing facility for another three years. However, the additional facility will depend on Beijing’s approval, as previous requests for increased debt limits were declined. This funding move underscores Pakistan’s ongoing need for external support amid its economic reforms.
These changes come as Pakistan seeks to broaden its economic base and attract international investment, with Aurangzeb noting growing interest from the American business community.
