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IMF talks: Pakistan “agrees” to impose a tax on income from agriculture

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For the new lending plan, representatives from the International Monetary Fund (IMF) and Pakistan’s provinces conducted virtual negotiations.

The provinces of Pakistan apparently agreed to impose a tax on agricultural income, as reported by sources who indicated that IMF officials pressed the provincial government to do.

All four of Pakistan’s provinces’ provincial governments requested more time to present a proposal for a tax on agricultural revenue. By July 12th, the plan would be delivered to the IMF.

The sources went on to state that the Rs 600,000 annual income will be subject to an agriculture income tax.

Continue reading: Pakistan “hopes to secure” a new loan programme from the IMF in July.

The sources stated that the global lender has set October 2024 as the deadline for changing the current provincial legislation to align them with the federal income tax law, subject to the new agreement being signed. Furthermore, by October of this year, the IMF has requested that all income tax exemptions for the livestock industry be revoked.

It should be mentioned that representatives of the finance ministry expect to finalise an agreement for the new loan programme in July. The precise budget for the new initiative is still being determined, but it is anticipated to cost between $6 billion and $8 billion.

Three years are anticipated to pass during the new loan programme with the IMF.

The Federal Budget, which has an overall expenditure of Rs18,870 billion, was adopted by the National Assembly (NA) on July 28 for the fiscal year 2024–25.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Business

Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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