Pakistan to Receive Much-Needed IMF Loan by Mid-July

An emergency meeting of the International Monetary Fund (IMF) is expected to approve the loan to Pakistan under the seventh review of the Extended Fund Facility (EFF) in mid-July, according to sources in the Ministry of Finance.

The seventh review talks with the IMF are expected to be completed by the first week of July.

The sources also revealed that the tax incentives given in the Finance Bill 2022 will be withdrawn, and the Minister for Finance, Miftah Ismail, will announce the withdrawal of tax concessions in his closing speech at the time of budget approval.

The ministry sources revealed that the income tax slabs are being reviewed, and the income tax exemption is likely to be abolished. They said after the federal government assured of ending tax incentives and increasing tax rates, the IMF now seeks documentary evidence for them, for which a copy of the Finance Bill will be shared with it.

The IMF’s Resident Representative, Esther Perez Ruiz, released a statement at a recent event in response to rumors about the IMF asking Pakistan to renegotiation the contracts of the China-Pakistan Economic Corridor (CPEC) Independent Power Producers (IPPs).

It reads, “The IMF did not ask Pakistan to renegotiate CPEC IPP contracts. These claims are simply untrue. Rather, the IMF supports the government’s multipronged strategy to restore energy sector viability which shares the burden of restoring viability across all stakeholders—the government, producers, and consumers.”