IMF proposes further tax increase for next fiscal year

• As per details, the Pakistan Business Council (PBC) held a zoom session with the IMF team. The IMF team proposed a 34 percent increase in tax revenue for the fiscal year 2021.

The International Monetary Fund (IMF) has proposed further tax increases for the next fiscal year.

As per details, the Pakistan Business Council (PBC) held a zoom session with the IMF team. The IMF team proposed a 34 percent increase in tax revenue for the fiscal year 2021.

According to the Pakistan Business Council, the IMF has projected 2pc growth in GDP with inflation to remain at 8pc for the next financial year, meanwhile, the interest rate has been projected at 11pc for next year.

Pakistan Business Council says demand for a policy rate hike will further worsen the economic scenario. The PCB further said that first the economy has to be further improved but more taxes will suffocate the economy.

Last month, IMF said its executive board had approved $1.386 billion in emergency financing to Pakistan to meet the balance of payments needed stemming from the novel coronavirus pandemic.

The funds, to come from the IMF's Rapid Financing Instrument, will help Pakistan deal with a decline in international reserves and allow it to fund targeted and temporary spending increases aimed at containing the pandemic and mitigating its economic impact, the IMF said.