According to Finance Minister Miftah Ismail on Wednesday, Pakistan was prepared to fulfil the final prerequisite of an increase in the tax on all petroleum products that the International Monetary Fund (IMF) had set for holding the board meeting to resuscitate the programme.
The minister's remarks ought to put an end to rumours that the administration would decide not to raise taxes starting in August because of the ongoing political situation. The finance minister adhered to the pledges made to the IMF when he declared, "There is a schedule to gradually increase petroleum levy rates according to which the levy will climb more in the future."
The foreign lender placed a requirement on receiving a loan to reform state-owned firms, therefore the finance minister spoke at a seminar that had been organised as a result. The seminar was paid for using the profits of a foreign loan at a time when the nation is on the edge of default.
Ismail claimed that the IMF had established the prerequisites for the approval of the new budget, including an agreement with the provinces to generate cash surpluses, an increase in the petroleum levy rates, an increase in the price of electricity in July, August, and October, as well as an increase in interest rates. He stated that these requirements have been satisfied.
In accordance with the terms of the agreement with the IMF, the government began charging Rs 10 per litre for gasoline starting in July. This fee must be hiked by another Rs 10 on August 1 until it progressively rises to Rs 50 per litre.
Due to the severe currency devaluation that has occurred over the previous ten days, which could fuel hyperinflation in the nation, petroleum product prices could increase significantly from August levels. According to the State Bank of Pakistan, the rupee dropped 1.31 percent and ended the day at Rs236 (SBP).
The IMF board meeting, according to the finance minister, will be later in August.
The finance minister added that there was a structural requirement for the creation of an expert committee to assess the efficacy of anti-corruption laws. "I have set conditions that the team will also investigate if these rules have ever been applied to political opponents and what the trade-off is between efficiency and the anti-corruption laws."
According to the finance minister, the previous Pakistan Tehreek-e-Insaf (PTI) administration put off signing the cheapest LNG contracts out of concern for NAB repercussions. We would appoint a team of international and Pakistani specialists to study these legislation, he continued, after consulting with the IMF.
The corruption in Pakistan has not decreased over the past 20 years, he claimed, and succeeding governments have not purchased more affordable commodities. He argued once more that existing regulations should not be followed in government-to-government sales agreements with foreign nations.
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