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President Alvi rejects approval of ‘mini-budget ordinance’ for IMF deal

On Tuesday, President Dr Arif Alvi rejected a request by the federal government to approve an ordinance that would impose new taxes to generate additional revenue in line with the conditions of the International Monetary Fund (IMF) and revive a stalled $6.5 billion bailout package.

According to an official statement released by the President House, Finance Minister Ishaq Dar had visited the president and updated him on the progress of talks with the IMF and all modalities that had been agreed upon.

The statement also mentioned that President Alvi appreciated the government’s efforts to negotiate an agreement with the IMF and assured that Pakistan would stand by the government’s commitments in this regard.

The finance minister informed the president that the government intended to increase revenue by imposing new taxes through an ordinance.

However, President Alvi advised that it would be more appropriate to take the parliament into confidence on this important subject and call a session immediately to ensure that the bill was enacted without delay.

The government had previously met two prior actions of increasing electricity and gas prices that were set by the IMF, along with other conditions, to reach a staff-level agreement.

According to details, gas consumers would have to pay an additional Rs310 billion in just six months.

Moreover, the government had already increased electricity prices by Rs3.30 to Rs15.52 per unit to recover Rs237 billion more until June, and another burden of Rs189 billion would be passed on in the form of increased taxes by June 2023.

As a result, these three measures would cost the people an extra Rs736 billion in just six months, which had increased due to the government’s failure to revive the IMF programme on time.

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