Pakistan and IMF Begin Talks, Proposal to Impose General Sales Tax on Petroleum Products

Negotiations between Pakistan and the International Monetary Fund (IMF) have commenced, with a proposal to impose a General Sales Tax (GST) on petroleum products. Reports indicate that, in addition to the GST, the petroleum levy may also be raised from the current rate of 60 PKR to 70 PKR per liter.

Sources reveal that the discussions will cover meeting the Federal Board of Revenue (FBR) targets and implementing new tax measures. The IMF team, led by Nathan Porter, arrived in Pakistan and began technical discussions on the first day.

Officials from the FBR, Ministry of Finance, State Bank, and Ministry of Energy met with the IMF team, focusing on strategies to meet the FBR’s targets. Currently, petroleum products are subject to zero GST, but the proposed changes could bring significant adjustments to the tax structure on these products.