- The IMF provides for an increase in the fertilizer FED from 5% to 10%.
- The world lender also offers a new 5% tax on pesticides.
- The guest director of the IMF for the Middle East to meet Prime Minister Shehbaz today.
Islamabad: The International Monetary Fund (IMF) puts pressure to considerably increase taxes on the main agricultural inputs in the upcoming budget, a decision that Prime Minister Shehbaz Sharif and his team would have ceased to mitigate or avoid.
Sources indicate that the IMF specifically called for an increase in the federal excise function (Fed) in fertilizers, from the 5% current to 10%, The news reported Thursday.
In addition, the world lender offers a new 5% tax on pesticides.
The requests were part of the discussions held Wednesday between Jihad Azour, the guest director of the IMF for the Middle East and the Minister of Finance of Pakistan, Mohammad Aurangzeb, at the Ministry of Finance, while they are working to finalize the national budget.
Prime Minister Shehbaz would have made efforts to persuade the IMF to reconsider these proposed tax increases, arguing that they would grant an undue burden for the farm sector.
A key discord for Pakistan is the imminent implementation of agricultural income tax (AI), which should become operational from July 1, 2025, with the next budget.
Although the ATA’s specific income projections are still in their early days, various estimates suggest that the provinces could generate between 40 of Rs and 50 billion rupees from short -term farmers.
“Revenues estimate the increase in the Fed On Fertilizer by 5% to 10% and the Fed Fed in Pesticides at the rate of 5% should recover RS30 tax revenue to 40 billion rupees among the pockets of farmers during the next financial year if the wish of the IMF is achieved”, “the main official sources confirmed to the next IMF’s exercise. officially confirmed at the next exercise of the financial year if the IMF’s wish is satisfied “,” the main official sources confirmed at the The news Wednesday.
Azour should meet the PM Shehbaz today.
Another proposal under study between the IMF and the Pakistani authorities is to ensure equivalent taxation of all sources of income and to introduce a registration threshold based on turnover for both income and registration of TPS to all companies in the coming budget.