Web Desk (LTN NEWS): Under IMF rules, the government is considering putting a 10.5% sales tax on gasoline and diesel starting in October, say sources.
In order to get the $6 billion IMF bailout package going again, the coalition government is likely to raise the prices of petroleum products by as much as Rs20 per liter on September 1. Sources in the know say that this is what will happen.
In the letter of intent (LoI) to the IMF, the government had written that they had put a sales tax on petroleum products. However, the sources said that the sales tax rate on the item is likely to go up starting next month, as reported by Daily Jang.
In order to meet the IMF’s requirements, the federal government is likely to stop exempting the agricultural sector from sales tax on petroleum products starting September 1.
Under the terms set by the International Monetary Fund, the government is thinking about putting a 10.5% sales tax on gasoline and diesel starting in October (IMF).
As part of an agreement with the IMF, the government has already taken away subsidies for petroleum products. This has caused a wave of inflation.
IMF executive board meeting on August 29
On August 17, Finance Minister Miftah Ismail confirmed that the government had sent the letter of intent (LoI) back to the IMF after meeting the requirements. This made it possible for the executive board to meet.
In his talk with reporters, the finance minister said that the document, which the lender got on August 12, was sent to the lender after he and the acting governor of the State Bank of Pakistan (SBP), Murtaza Syed, signed it.
This has cleared the way for the IMF’s executive board meeting on August 29. At that meeting, Pakistan will ask the board to approve its seventh and eighth reviews and release a $1.17 billion payment under the Extended Fund Facility (EFF).
