The NA panel said three IMF targets under the $7 billion package were not met.

ISLAMABAD: The Finance Ministry has admitted that it failed to meet three targets under the $7 billion Expanded Fund Facility (EFF), including FBR’s revenue collection target for the first quarter and health and education. Costs are included.

Provincial governments missed the October 2024 deadline to amend their agricultural income tax legislation. The Federal Secretary Finance gave a detailed presentation to the National Assembly Standing Committee on Finance on Quantitative Performance Criteria and Structural Criteria of the International Monetary Fund (IMF). Program

The committee was told that each province needs to amend its agricultural income tax law to make it fully compatible with the federal personal income tax system for small farmers and the federal corporate income tax system for commercial agriculture. It is necessary to do so that the tax can start from January 1. , 2025. The timeline for the legislation was at the end of October 2024, which was delayed. The province of Punjab made the law. In the case of KP, the law has been approved by the Cabinet and is awaiting placement in the Assembly.

The government will introduce five percent Federal Excise Duty (FED) on pesticides and fertilizers in the next fiscal year’s budget. The Federal and Provincial Governments agree that some of the expenditure responsibilities of the Government of Pakistan shall be transferred to the Provincial Governments under the provisions of the 18th Constitutional Amendment, including higher education, health, social security and regional affairs. Includes additional contributions for Along with public infrastructure investment, provinces will also take steps to increase self-tax collection efforts in sales tax on services, property tax and agricultural income tax.

According to the proposed legislation, provincial governments:

1. Amending the Agricultural Income Tax (AIT) regimes to fully harmonize them with the federal personal income (small farmers) and corporate income (commercial agriculture) tax regimes by the end of October 2024 through the necessary legislative changes. Do and start taxing agricultural income. The new system will start from January 1, 2025 with collection for the second half of the financial year in July 2024-25 agricultural income.

2. Shift Services GST from positive list to negative list approach to combat tax evasion with effect from the beginning of FY 2025-26.

3. Corporate tax in agriculture and GST on services aim to increase overall revenue with provincial tax efforts in expanding additional areas of revenue collection.

4. Develop, implement and collect revenue under a common approach to property taxation.

5. Implement necessary administrative reforms to reduce the tax compliance gap, including for GST. 6 The terms of reference of the National Tax Council shall be extended to include the design of relevant tax measures including property tax and the legislative and administrative changes necessary for their implementation.

6. Provinces will provide additional support to higher education for initiatives undertaken by the Higher Education Commission (NEC) in collaboration with the Federal Government. Federal and provincial governments will gradually rebuild spending on health and education programs as a share of GDP.

7. The Federal Government, in consultation with the Provincial Governments, shall examine the social security programs formulated/planned by the Provincial Governments and BISP respectively, to identify overlapping programs and financial allocations. , and take fiscally prudent actions accordingly, in ways that are stronger and better. Generosity and Social Security coverage.

8. Provinces shall bear all expenditure of PSDP, benefiting only one province and any expenditure by the Federal Government in the areas reserved for provinces in the 18th Amendment as decided by the National Economic Council (NEC). Costs are fixed, with certain exceptions. Based on well defined criteria by NEC.

9. Provinces will stop announcing support prices (for raw commodities) and also stop procurement activities.

10. The federal government will reduce its footprint in line with the 18th Amendment.

11 If necessary, matters requiring federal and provincial consensus and coordination may be referred to the Forum of the Council of Common Interests (CCI) or the NEC.

12. Federal and Provincial Governments shall implement Electronic Pakistan Acquisition and Disposal System (ePads).

13. Federal and provincial governments to adopt green budget tagging by June 2025 end.

14. Provincial anti-corruption agencies National AMUCFT Authority and other relevant agencies like Financial Monitoring Unit (FMU), Federal Board of Revenue (FBR), National Accountability Bureau (NAB) etc. Will contact for implementation of ML. /CFT strategy.

15. The federal and provincial governments will issue regulations to allow banks to access the wealth statements of high level provincial public officials (BPS17-22).

16. The Provincial Governments shall facilitate the extension of the Pakistan Single Window Platform to the Provincial Departments by the end of FY26.

17. The Federal and Provincial Governments will facilitate rapid progress towards full digitization of government payments and promotion of digitization of public records which will increase access to credit for the currently disadvantaged sections of the population.

Also, amid opposition leader Umar Ayub’s protest against the NA panel’s in-camera decision, Finance Minister Muhammad Aurangzeb on Monday said Pakistan had to bail out IMF programs 25 times, as any The program has not been fully implemented.

“It is not that simple. If the IMF program was fully implemented, the country would not have entered the fund program 25 times.

He said that there cannot be a sequential approach because it has become an existential problem to deal with all the problems simultaneously, including the growing population bomb, 40 percent stunting of children, poverty, climate degradation and Air pollution is included. They will sign a 10-year Country Partnership Strategy (CPS) with the World Bank to address four of these priorities.

National Assembly Standing Committee on Finance Chairman Naveed Qamar facilitated the Finance Ministry and Treasury Benches and announced to hold an in-camera detailed answer/question session on the IMF despite strong opposition from some other members.

Leader of the Opposition in the National Assembly Umar Ayub strongly protested Naveed Qamar’s announcement regarding the in-camera meeting.

Briefing reporters after the conclusion of the NA panel, Umar Ayub said he demanded the government include all state officials in the list of asset declarations similar to the way MPs do on a similar declaration form. is on

Earlier, Finance Minister Mohammad Aurangzeb told the NA panel that the foreign exchange reserves will reach to cover three months of import cover from March to June 2025.

He said that international lenders and credit rating agencies sent a loud and clear message that Pakistan must stick to its reforms.

Federal Secretary Finance Imdadullah Bosal told the NA panel that 22 structural standards have been agreed upon under the IMF program’s $7 billion Expanded Fund Facility (EFF), of which 18 are the federal government and the State Bank of India. are related to Pakistan while 4 are related to To the provinces