Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain said on Wednesday that Pakistan had promised the IMF to reduce subsidies on energy, increase revenue, remove a ban on imports, cut expenditures on salaries and pensions, and allocate an additional amount for the Benazir Income Support Programme to get the standby programme.
He said that Pakistan has also promised to keep the difference between the open market and the interbank rate of the dollar within the limit of 1.25 percent.
Mian Zahid Hussain said that the full implementation of all these conditions is in the interest of Pakistan.
Talking to the business community, the veteran business leader said that the IMF has asked the government for a plan to levy taxes on the favoured sectors of agriculture and construction to raise revenue, which must be fulfilled and implemented.
He said that now we must stop prioritising politics over the economy and force non-taxpaying sectors to pay tax; otherwise, the next IMF review due in November may be stalled.
Mian Zahid Hussain said that, on the one hand, the IMF is asking for a plan to impose taxes on agriculture and the real estate sector as per the agreement reached with the government of Pakistan; on the other hand, according to reports, a change has been quietly made in the General Sales Tax Act, which will push 4800 of the 9082 large retailers out of the tax net.
He added that this decision will result in a tax shortfall, which will shift the burden on the industrial sector and the salaried people, who are already reeling under the burden of inflation and other problems.
Mian Zahid Hussain said that this time, the deviation from the agreement will have dangerous consequences, which are not being taken seriously.
The business leader further said that favours to the blue-eyed sectors are no longer possible, and before the IMF takes any action in this regard, the changes made in the Sales Tax Act should be withdrawn.
The IMF should not be insulted by violating the agreement; otherwise, the economy will again be bankrupt if the lender takes serious action.
He said that keeping certain sectors out of the tax net in a country that has been creating world records in population growth, poverty, and illiteracy is tantamount to filling the foundations of the economy with explosives.
He warned that in the event of a default, no one would be spared from its terrible political, social, and political implications.
In these circumstances, when compliance with the current standby programme of the IMF appears difficult, the lender will never agree to another programme.