IMF chief urges Pakistan to increase taxation on the wealthy, protect the underprivileged

  • Stock Market News
IMF chief urges Pakistan to increase taxation on the wealthy, protect the underprivileged

International Monetary Fund (IMF) Managing Director, Kristalina Georgieva, reiterated her call for Pakistan to bolster tax collection from its affluent citizens while safeguarding the welfare of the underprivileged, during her meeting with Pakistan's caretaker Prime Minister Anwaar-ul-Haq Kakar on Wednesday. This meeting took place on the sidelines of the 78th UNGA session in New York.

Ms. Georgieva emphasized the importance of aligning these efforts with the IMF program aimed at supporting the Pakistani populace. She stressed that Pakistan must revitalize its economy and rectify past shortcomings for the benefit of its citizens.

During their discussion, Prime Minister Kakar expressed gratitude for the IMF's approval earlier this year of a $3 billion Stand-By Agreement (SBA) aimed at assisting Pakistan's economy. He also outlined his government's measures to stabilize and rejuvenate the national economy, including creating a stable environment for sustainable growth and protecting vulnerable segments of society.

The IMF Managing Director commended Pakistan's dedication to implementing economic recovery policies and reforms and reaffirmed the IMF's commitment to ongoing collaboration with Pakistan.

On Wednesday, Ms. Georgieva stated that there was agreement on the vital need for strong policies to ensure stability, foster sustainable and inclusive growth, prioritize revenue collection, and protection for the most vulnerable in Pakistan. She further emphasized that the IMF's program requests Pakistan to collect more taxes from the wealthy and protect its poor citizens.

Earlier this year, she had issued a similar statement asking Pakistan to raise tax revenues and have a fairer distribution of pressures by moving subsidies only toward people who really need them. She emphasized then that it shouldn't be that the wealthy benefit from subsidies, but rather the poor who should benefit from them.

This is not a new stance for the IMF or Ms. Georgieva. In fact, this is the second time that she has publicly stated that the Fund wants Pakistan to collect more taxes from the rich and protect the poor. The current caretaker government and previously the coalition government headed by Shehbaz Sharif have claimed that they cannot provide relief in taxes as they are in an IMF program.

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