No relief on power bills as IMF rejects Pakistan’s proposal

The International Monetary Fund (IMF) has turned down Pakistan’s proposal to abolish General Sales Tax (GST) on electricity bills in an effort to provide relief to consumers.

During ongoing economic review talks, the government also presented proposals to ease the tax burden on the real estate, property, beverage, and tobacco sectors.

Sources privy to the development said tax reductions in these sectors may be implemented with the IMF’s approval. Additionally, there are discussions on reducing tax rates for the salaried class in the next budget.

To bridge the revenue gap, the government has outlined a plan to collect Rs 250 billion through various sectors, including retail. Tax collection is expected to be facilitated through trader-friendly schemes, compliance risk management, and administrative measures, with final approval resting with the IMF.

Meanwhile, Pakistan and the IMF are also negotiating strategies to address the mounting circular debt in the energy sector.