Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb has called for fundamental economic reforms to make the current International Monetary Fund (IMF) programme the last one for the country. In an interview with Voice of America (VOA) after the approval of IMF loan program, the finance minister said that fransformation of the economy into an export-driven one necessitates structural reforms, only then could the country move forward in the next three years. It should be mentioned here that IMF board on Wednesday approved the 37-month Extended Fund Facility (EFF) programme of $7 billion for Pakistan and has authorized the immediate release of the first tranche of about $1 billion. Muhammad Aurangzeb said that the friendly countries have assured financial support to meet the financial needs through the new IMF program.

The government had no choice but to implement economic reforms, which included bringing sectors currently outside the tax net into the fold, he added. The finance minister said that the burden on salaried and manufacturing classes would be reduced and highlighted the need to bring into tax net the retailers, wholesalers, agriculture, and property sectors. Despite a 29% increase in revenues last year, the tax-to-GDP ratio remained at 9%, which was insufficient to stabilize any country’s economy, he observed. Muhammad Aurangzeb mentioned that the government was abolishing the term “non-filer” and will impose restrictions on tax evaders, limiting their ability to conduct various activities. He noted that the government possesses data on individuals’ lifestyles, including the number of vehicles owned, international travel, and other expenditures.

This information will enable the Federal Board of Revenue (FBR) to bring tax evaders into the tax net without arrest, he added. The finance minister said Pakistan’s undocumented economy has been valued at Rs.9 trillion, which needed to be documented. Senator Aurangzeb said Prime Minister Shehbaz Sharif believed that business should be handled by the private sector and not by the government. To achieve this, the cabinet’s privatization committee has advanced the privatization process of government institutions to its final stages, he added.

Credit: Independent News Pakistan