Pakistan's Financial Crossroads: Tax Boost or Endless IMF Bailouts

Pakistan Finance Minister Muhammad Aurangzeb warns that Pakistan may continue seeking IMF bailouts if tax revenues are not increased. Aiming for a $6-8 billion IMF loan, Aurangzeb emphasizes the urgency to boost tax collection, revealed punitive measures against tax avoiders, and highlighted the challenge of achieving long-term economic stability.

Pakistan Finance Minister Muhammad Aurangzeb has cautioned that the cash-strapped nation will have to keep seeking IMF bailouts if it fails to increase tax revenue. He expressed 'relative confidence' in securing a $6-8 billion IMF loan this month.

Aurangzeb warned that without higher tax revenues, this won't be the last IMF program. The government passed a heavily taxed budget for the fiscal year 2024-25 amid opposition protests labeling it as IMF-driven and harmful to the public.

As Pakistan kicked off the new fiscal year, it sharply raised fuel prices. Taxes will mainly affect salaried workers and some businesses. Punitive measures for tax avoiders include restricting phone, gas, electricity access, and travel capability. Efforts are on to restore the ailing economy within months, amidst investor confidence and mounting debt.

(With inputs from agencies.)