Rana Muhammad Afzal—State Minister for Finance said that Pakistan needs to pay back $6 billion to the international creditors in the period of next six months. He also added quickly that government was in a position to manage repaying.
After taking an oath a day prior while talking to media he informed that a scheme was under consideration for bringing in money from abroad to facilitate the Pakistanis. He said this scheme is being considered for broadening the tax net.
He also spoke on the probability of presenting the new budget for the financial year 2018-19 by the present PML-N government which would be the sixth budget during its span of rule.
He had the view that the present government is more in the position of presenting the budget for the next year as compared to the upcoming short-term government because of the reason that they would have very little time for preparing the national budget.
Last week the amount of $3.6 billion foreign debt repayment was told in the National Assembly Standing Committee by Shahid Mehmood—Finance Secretary which is way less than the amount of $6 billion.
Mr Afzal declared that the following six months would be important for the management of the country’s economy. He firmly declared that the government has no plan or whatsoever of going to the International Monetary Fund (IMF) for a bailout.
During the last two democratic rules, the foreign debt has mounted to a huge amount which is expected to rise more after 2020 when the projects under China Pakistan Economic Corridor (CPEC) would start maturing.
The current account deficit has also increased heavily because of the rise in imports and decrease in exports, bringing the foreign currency funds under pressure. Pakistan’s gross official foreign currency funds are $14.33 billion as of 22nd December, which is hardly enough for three months of more imports.
The Minister mentioned that there were many industries doing well and gave the examples of large-scale manufacturing industries and remittances.
He holds the view that the budget deficit should be limited to five percent—which is currently 5.3 percent owing to the IMF projections of GDP.
On the matter of tax reforms, the minister said that the government was making strategies to go after the ones who dodge tax and has also identified ten thousand such individuals based on data. These people would be brought into the tax net from next month.
These potential tax evaders have been identified in various sectors including property, education and other services. These people would be sent notices next month.
Mr Afzal was also definite that the recently implied regulatory duty on the different import goods would also start showing its positive outcomes on the profit collection soon.
He added that the tax filers count has also increased from 0.914 to 1.14 million so far during the current fiscal year 2017-2018, which again as per him a good sign.
As per the Federal Board of Revenue’s (FBR) proposal in return for law the not unveiled foreign assets, the non-resident and resident Pakistanis would be paying foreign asset tax.
Assets outside Pakistan in possession for more than five years up to 30th June 2016 could be subjected to tax two percent. Income and assists outside Pakistan which are expelled by 15th June 2017 via lawful banking chains to Pakistan with a receipt attached holding a declaration would be subjected to tax five percent.
Foreign currency and assets holders would be obliged to pay fifteen percent tax.