In a recent press briefing, Finance Minister Aurangzeb Pakistan disclosed plans to increase the tax-to-GDP to 13-14 percent within the next four years. Aurangze identified pensions as a significant burden on the federal budget, emphasizing the necessity for substantial reforms to address this issue.
Joined by Information Minister Attaullah Tarar and Law Minister Azam Nazir Tarar, Aurangzeb stressed the government’s commitment to controlling pension costs through potential measures such as raising the retirement age to alleviate financial strain from pension liabilities. He also advocated for significant tax reforms to strengthen the country’s economy.
Highlighting the importance of infrastructure development, Aurangzeb urged a focus on the private sector to drive economic growth. He underscored the importance of managing non-development expenditures to ensure fiscal discipline and mentioned potential collaborations with China for capital market initiatives.
Aurangzeb noted the positive outcomes of the recent visit to Saudi Arabia, highlighting progress towards economic objectives. He acknowledged the increase in foreign exchange reserves following a $1.1 billion deposit by the International Monetary Fund (IMF) into the State Bank of Pakistan. Additionally, he revealed plans for an IMF delegation to visit Pakistan later in the month to discuss a new loan program, fostering international cooperation and support for the country’s financial strategies.
Law Minister Azam Nazir Tarar outlined the forthcoming IMF discussions focusing on climate financing and digitalization. He emphasized the importance of transparency in pension reforms, assuring that legal adjustments would be implemented to promote inclusive governance.
Overall, the government’s strategy aims to achieve financial stability through a combination of tax reforms, pension cost management, and international collaboration. Despite challenges, these initiatives demonstrate a dedication to addressing Pakistan’s financial concerns and stimulating economic growth.
