Prime Minister Shehbaz Sharif on Wednesday agreed to take hard decisions for the revival of the IMF Programme
According to details, The tough decisions include hiking the gas and electricity tariffs and unveiling a mini-budget for imposing more taxation measures to fetch Rs150-200 billion.
Also Read : IMF asked Pakistan to raise Power & Gas Tariff for the Revival of Loan Programme
Official sources within the government told that “The Prime Minister chaired an online meeting Wednesday evening for around three hours and thirty minutes in which important decisions were taken. However, this meeting is expected to be reconvened on Thursday (today) for taking more crucial decisions.”
When asked about the possible hike in electricity and gas prices, the State Minister for Petroleum Musadik Malik did not reply.
However, sources, privy to the development, said the gas tariff is expected to increase from Rs650 per MMBTU to Rs1,100 per MMBTU on average.
SNGPL and SSGCL have a monstrous circular debt of Rs1,640 billion, the government plans to recover Rs800 to Rs850 billion via the new price hike.
Meanwhile, in the power sector, the government is considering raising the electricity tariff from Rs4.50 per unit in the first phase and Rs3 per unit in the second phase within the ongoing fiscal year.
The government also has plans to slap a 1 to 3% flood levy on imports to fetch Rs100 billion.
Secondly, the government is also considering slapping a 60 to 70% tax on commercial banks’ alleged earnings through manipulation of the exchange rate. The banks estimated earned around Rs100 billion in extraordinary profits in the first nine months of the calendar year 2022.
An increase in the Excise Duty (FED) on sugary beverages, and cigarettes and slapping GST on POL products is also on cards. However, in the recent past, Finance Minister Ishaq Dar opposed regulating 17% GST on POL products, arguing that it would be highly inflationary.
Rember here one thing that Finance Minister Ishaq Dar already announces that Mini-budget includes some tough measures like imposing a “flood levy” and increasing Duty on Petroleum products in order to stabilize the economy.
