President Arif Alvi on Thursday signed the Finance (Supplementary) Bill 2023, the government’s much-needed tranche of $1.1 billion International Monetary Fund (IMF) loan.
The Finance Bill or “Money Budget” is passed under Article 75 of the Constitution of Pakistan.
The federal government on Monday passed the Finance (Supplementary) Bill, 2023, amid talks with the international lender to meet its conditions to prop up Pakistan’s sagging economy.
The bill raises sales tax to 17-25 percent on imports ranging from cars and home appliances to chocolate and cosmetics. General sales tax has been increased from 17% to 18%.
People will also have to pay more for business class air travel, wedding halls, mobile phones and glasses.
The bill was followed by the unveiling of austerity measures by Prime Minister Shehbaz Sharif, which Finance Minister Ishaq Dar called “difficult decisions”.
The prime minister unveiled a series of austerity measures to save Rs 200 billion – aimed at keeping the country afloat as the nation prepares to meet IMF conditions.
PM Shehbaz confident $6.5bn IMF programme to revive ‘soon’
“The IMF program will be revived soon, God willing, as there are one or two items that remain to be implemented,” the prime minister said while addressing the federal cabinet in Islamabad on Wednesday.
“I had a constructive discussion with the parliamentarians about the development of the economy. The nation is going through a difficult time. We have to learn from our past mistakes and move forward,” he said.
Pakistan is eager to open the next tranche of credit facilities but is struggling to meet tough conditions set by the International Monetary Fund, which requires the country to pay back its pathetically low taxes. boost the base, eliminate exemptions for the export sector, and artificially lower energy prices. The purpose of which is to help poor families.
The country is in dire need of funds as it is battling a severe economic crisis as foreign exchange reserves held by the State Bank of Pakistan (SBP) barely cover a month’s worth of imports.
