The proposal to eliminate the goods and services tax (GST) on electricity bills for consumers has been rejected in the economic review negotiations between Pakistan and the International Monetary Fund, sources said on Friday.

The IMF denied permission to extend the winter relief package for the industrial and agricultural sectors throughout the fiscal year.

Moreover, the proposal to remove GST on electricity bills to lower costs for consumers was also dismissed.

There are various proposals under consideration aimed at providing relief to sectors such as real estate, property, beverages, and tobacco.

In the upcoming budget, there is also a plan to reduce the tax burden on salaried individuals, which will be contingent upon IMF approval.

The government is planning to collect Rs250 billion in taxes from various sectors, including retail. It would be achieved through administrative measures such as “business-friendly schemes and compliance risk management, however, final approval will be given by the IMF.”

Furthermore, the IMF has been informed that to control the circular debt, the government would borrow Rs1.25 trillion from commercial banks at an interest rate of 10.8%, with an agreement already established for this loan.

Also, the federal government has planned to cut the tariffs for electricity purchased from net metering consumers by Rs17, sources said.

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