Fitch Ratings told: Over 0.15m retailers registered as new taxpayers: Aurangzeb

ISLAMABAD: Finance Minister Muhammad Aurangzeb on Monday said more than 150,000 retailers have been registered as first-time taxpayers.

The finance minister stated this during a Zoom meeting with the representatives from Fitch Ratings led by Senior Director Thomas Rookmaaker, Directors Asia Pacific Sovereign Krisjanis Krustins and Jeremy Zook on Monday.

Aurangzeb mentioned the government’s efforts to broaden the tax base and stated that a substantial 30 percent increase in tax collection was achieved during the fiscal year 2024 as opposed to the previous year.

Additionally, he said that more than 150,000 retailers have registered as first-time taxpayers. He said that the government is committed to further improving the tax-to-GDP ratio as part of the ongoing fiscal consolidation measures.

Aurangzeb said that IT exports have crossed the figure of US$ 3 billion, foreign exchange reserves reached US$ 9.4 billion, robust stock exchange performance, and CPI inflation at 12.6 percent in June 2024. There was 7.7 percent increase in foreign remittances, he added.

The minister gave an update on Pakistan’s current economic situation starting with the successful completion of Pakistan’s 9-month Stand-By-Arrangement with the International Monetary Fund (IMF), and highlighted its positive impact on the country’s macroeconomic indicators.

The discussions also covered ongoing reforms in the energy sector and SOEs, including privatisation and rightsizing of federal government entities to streamline operations and improve governance.

Aurangzeb informed the rating agency about multilateral institutions’ confidence in financing Pakistan’s projects and briefed them about Pakistan’s Staff-Level Agreement (SLA) finalized in July 2024 with the IMF for a new medium-term program aimed at bolstering Pakistan’s home-grown economic reform agenda.

He apprised the Fitch representatives of salient features of the new programme which includes setting a target of increasing revenues by 1.5 percent of GDP in fiscal year 2025 and by three percent over the coming three years. A primary surplus of one percent of GDP will also be achieved for the fiscal year 2025.

The Finance Ministry claimed that the representatives of Fitch Ratings appreciated the ambitious targets and fiscal measures adopted of the government and acknowledged the improvement in economic indicators.

Copyright Business Recorder, 2024