Pakistan has requested the International Monetary Fund (IMF) to further reduce tax collection target. However, a mini budget of nearly Rs200 billion will remain inevitable to collect even less than Rs5 trillion in this fiscal year.

In first face-to-face meeting between Pakistan and the IMF for second review talks, the government informed the IMF that it cannot collect more than Rs4.7 trillion while the IMF stressed that the Federal Board of Revenue (FBR) should still aim at Rs5.238 trillion, The Express Tribune reported citing sources.

The IMF asked to immediately go for additional revenue measures, they added.

Pakistan has made the request due to prevailing political instability coupled with tight economic conditions that have adversely affected almost every household, source in the Ministry of Finance said.

Talks between Pakistan and the IMF for the second quarter (October-December) 2019-20 began on Monday. Finance Adviser Dr Abdul Hafeez Shaikh kicked off the review talks with his counterpart Ernest Rigo, the IMF’s Washington-based mission chief. The talks are likely to continue till end of next week.

If talks remain successful and the government also brings in a mini-budget ahead of next board meeting, the IMF may approve third loan tranche of $450 million next month.