IMF Seeks 1% GST Hike to 19%, Pakistan Resists Over Inflation Fears

• The IMF wants Pakistan to raise GST from 18% to 19% in the 2026-27 budget, but Pakistani authorities are resisting because it could worsen inflation.
• A 1% GST increase could generate an estimated Rs250-300 billion in extra revenue.
• The IMF is also seeking higher GST on hybrid vehicles, while discussions on electric vehicles are still ongoing.
• The Fund has backed a fixed-tax scheme for small retailers and may allow a 1.5-2% cut in Super Tax, while talks on relief for salaried taxpayers continue.
• Negotiations remain tense, with possible last-minute budget changes; the FBR chairman denied that such a GST hike proposal is being considered.

Source: thenews.pk

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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