Pakistan’s Finance Minister, Muhammad Aurangzeb, has warned that the country will continue to rely on International Monetary Fund (IMF) bailouts unless it significantly improves its tax revenue. Aurangzeb expressed confidence in reaching a staff-level agreement with the IMF for a loan of $6-$8 billion but emphasized that this would not be the last fund program if tax revenues are not increased.
The government has presented a tax-loaded budget for FY25, aiming to raise Rs13 trillion by next July, a 40% increase from the current financial year. The budget targets salaried workers, retail, and export businesses, and threatens punitive measures for tax avoiders.
Aurangzeb stressed that Pakistan must “start showing, start delivering” in the next two to three months to reset its ailing economy. He acknowledged the challenge of putting Pakistan on a path to longer-term growth and debt sustainability, citing the country’s reliance on imports and failure to invest in productive sectors.
The finance minister also emphasized the need to create capacity to repay loans and urged Gulf investors to provide bankable projects. He criticized corruption at the Federal Board of Revenue, saying it discourages people from dealing with the tax authority.
Pakistan’s debt has soared since the mid-2000s, and the country remains reliant on imports, forcing it to borrow to pay off debts. Aurangzeb’s warnings highlight the urgent need for Pakistan to boost tax revenue and achieve economic stability.
