Pakistan and IMF Continue Negotiations on Upcoming Federal Budget

Updated: 6:44 PM PKT — May 20, 2026

Due to inconclusive negotiations over federal budget targets, the International Monetary Fund mission has extended its stay in Pakistan for two more days. A key point of contention is the Fund’s demand to impose an 18% GST on electric vehicles, whereas the government has proposed a tax of only 1%. The federal budget is now likely to be presented on June 5th.

Updated: 1:41 PM PKT — May 20, 2026

Prime Minister Shehbaz Sharif chaired a high-level meeting to review proposals for the upcoming budget, which is expected to be presented on June 5. As part of these final-stage negotiations, a new auto policy is being drafted. The government has proposed a 1 percent general sales tax on electric vehicles, while the IMF is reportedly demanding a rate of 18 percent.

Updated: 12:12 PM PKT — May 20, 2026

The federal budget’s presentation has been delayed until around June 12, as the IMF is reportedly demanding additional taxes at both federal and provincial levels. Meanwhile, former Finance Minister Miftah Ismail has criticized the government’s economic performance, citing rising poverty and a fear of implementing necessary reforms.

Updated: 9:32 AM PKT — May 20, 2026

Recent discussions have hit a snag, with the IMF reportedly demanding the imposition of additional taxes at both the federal and provincial levels. In a separate development, former Finance Minister Miftah Ismail criticized the government, stating it is reluctant to implement difficult but necessary economic reforms.

Updated: 8:45 AM PKT — May 20, 2026

Amid the ongoing talks, the IMF is reportedly pushing for additional taxes to meet revenue targets. In a separate development, former Finance Minister Miftah Ismail criticized the government’s economic policies, stating they have failed to deliver and have led to increased poverty and unemployment.

Updated: 5:17 AM PKT — May 20, 2026

The IMF is reportedly demanding that provinces raise an additional Rs. 400 billion through increased taxes on agriculture, property, and excise duty, and has identified risks related to Pakistan’s loan repayment schedule. Separately, former Finance Minister Miftah Ismail has criticized the government for its hesitation to implement necessary economic reforms.

Updated: 11:51 PM PKT — May 19, 2026

The International Monetary Fund is reportedly demanding additional tax collection at both the federal and provincial levels. Separately, former Finance Minister Miftah Ismail criticized the government’s economic performance, claiming that poverty and unemployment have risen.

Updated: 10:29 PM PKT — May 19, 2026

Federal Finance Minister Muhammad Aurangzeb held a virtual meeting with provincial ministers to discuss the IMF’s demand for increased revenue generation from the provinces. The consultations reportedly focused on increasing taxes on agricultural income, property, and excise duties to meet the Fund’s targets.

Updated: 8:26 PM PKT — May 19, 2026

An agreement on a macroeconomic framework has reportedly been reached as part of negotiations for a new bailout package. However, key budgetary disagreements persist, with the Fund insisting on a primary surplus of 2% of GDP. The IMF has also called for increased tax collection at both the federal and provincial levels.

Updated: 8:03 PM PKT — May 19, 2026

To meet revenue targets, the IMF is reportedly demanding the collection of additional taxes at both the federal and provincial levels. Specific proposals under consideration include taxing agricultural income and increasing property and services taxes.

Updated: 6:47 PM PKT — May 19, 2026

Negotiations have reportedly entered their final stages, with disagreements persisting over the IMF’s demand for additional tax collection at both federal and provincial levels. The Fund has also highlighted specific risks associated with the country’s loan repayments.

Updated: 5:53 PM PKT — May 19, 2026

The IMF is now pressing for taxes to be broadened to include sectors like agriculture and real estate, and has required provincial governments to generate an additional Rs. 400 billion in revenue. Meanwhile, a consensus has reportedly been reached on a macroeconomic framework, targeting 4.1% GDP growth and an 8.6% inflation rate.

Updated: 5:32 PM PKT — May 19, 2026

As negotiations enter their final phase, the IMF is pushing for additional tax collection at both federal and provincial levels. The Fund has also highlighted potential risks associated with Pakistan’s ability to service its debt in the next fiscal year.

Updated: 5:12 PM PKT — May 19, 2026

Negotiations for a new program have entered their final stages, with the IMF pushing for an additional 400 billion rupees in revenue to be generated by the provinces. To address this demand, the federal finance minister held a virtual meeting with provincial counterparts to discuss raising taxes on agriculture, property, and excise duties.

Updated: 4:47 PM PKT — May 19, 2026

The International Monetary Fund has reportedly asked Pakistan’s provinces to collectively raise an additional Rs. 400 billion in revenue for the next fiscal budget. Federal Finance Minister Muhammad Aurangzeb held a virtual meeting with provincial finance ministers to discuss the demand. The consultation focused on boosting provincial income by raising taxes on agricultural income, property, and excise duties to bring all sectors into the tax net.