Islamabad, Mar 7 2025: Amid ongoing discussions between Pakistan and the International Monetary Fund (IMF) regarding the economic review, the global financial institution, IMF Rejects Pakistan’s Request to Remove GST on Electricity Bills
According to insider sources, the IMF has also refused to extend the winter relief package for the industrial and agricultural sectors for the remainder of the fiscal year. The government had sought an extension to support these key industries, but the proposal was not accepted by the global lender.
Furthermore, officials disclosed that the government is contemplating tax concessions for various sectors, including real estate, property, beverages, and tobacco.
If approved by the IMF GST on Electricity Bills, these industries could see a significant reduction in their tax liabilities. Additionally, authorities are considering easing tax pressures on salaried individuals in the forthcoming budget to provide financial relief.
In an effort to bolster revenue collection, the government has devised a strategy to amass approximately Rs. 250 billion in taxes across multiple sectors, including retail.
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This will be facilitated through trader-friendly initiatives, compliance risk management, and other administrative reforms. However, the final implementation of these measures remains subject to IMF approval.
Another key area of discussion with the IMF revolves around addressing the mounting circular debt in the energy sector. Government representatives have informed the IMF that an agreement has been reached to secure Rs. 1.25 trillion in loans from commercial banks at an interest rate of 10.8%.
This borrowing plan aims to mitigate the ongoing financial strain within the power sector and is part of broader efforts to stabilize the economy.
As Pakistan navigates these critical financial negotiations, the government remains focused on securing IMF-backed policies that balance economic growth with fiscal discipline. The outcome of these talks will play a pivotal role in shaping the country’s economic trajectory in the coming months.
