IMF deal close to agreement as Pakistan receives MEFP for 7th and 8th review

MEFP outlines number of prerequisite measures to be taken

Finance Minister Miftah Ismail has said that Pakistan had obtained targets for its seventh and eighth reviews of the International Monetary Fund bailout program for combined evaluations.

In a tweet on Tuesday morning, Miftah Ismail that the government had received a Memorandum of Economic and Financial Policies (MEFP) from the IMF for the combined seventh and eighth reviews.

According to the outlines of MEFP, there are a number of prerequisite measures that need to be taken before the approval and final release of $1 billion in July.

IMF and Pakistan have already made significant progress on revival of the deal regarding the Extended Fund Facility (EFF) in the budget for fiscal year 2022-23.

Pakistan has promised the fund to raise an additional Rs436 billion in taxes and gradually increase the petroleum prices up to Rs50 per liter.

The Pakistani government has also decided to implement a poverty tax of one percent on incomes below Rs150 million, two percent on incomes between Rs200 million and Rs250 million, and three percent on incomes exceeding Rs250 million and four percent on over Rs300 million.

Earlier, the two percent poverty tax was imposed only upon the people who are earning Rs300 million or more.

Pakistan also promised to deliver a Rs152 billion primary budget surplus according to which all expenses would be covered by revenue after tax payments.

Senator Shaukat Tarin, former finance minister has said that the MEFP would be a lengthy and intricate document that would be debated over and analyzed. He said that after a technical reaching agreement, it would be sent to the IMF board in Washington.

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