Talks with IMF to begin at Dubai on November 2

[LahoreEstate]

AHMED MUKHTAR
ISLAMABAD (October 20 2009): An IMF mission will reach Dubai on November 2 to start 10-day discussions with Pakistan's officials for end-September targets of its $10.1 billion Stand-By Arrangement, an official said. "The talks are scheduled in Dubai from November 2 to November 11, focusing on the targets fixed until September 2009," the official said.

Adnan Mazari, Assistance Director of IMF Menap Department, will lead the IMF side while Finance Secretary Salman Siddique will lead the Pakistan delegation. A recently cancelled international workshop by the Federal Board of Revenue (FBR), which was to be held from October 19 to 21, will now be held parallel to the mission meetings. The workshop was meant to enforce value-added tax (VAT) by July 2010. This is a key criterion determined in the IMF programme. The FBR had also to introduce legal changes in its structural cadre by introducing the new 'Inland Revenue Service' by combining sales and income taxes. Before December, Pakistan has also to submit broad-based VAT law before parliament.

"Pakistan has met almost all of its performance criteria targets agreed with the IMF for end-September, except fiscal deficit, which would be corrected technically in a month," said Finance Minister Shaukat Tarin two days earlier.

Pakistan has missed the fiscal deficit target of 1.3 percent of gross domestic product (GDP) in the first quarter of the current fiscal year that began from July, but is likely to meet the annual target of 4.9 percent.

"Advance salaries payment of Rs 35 billion for the month of September before Eid and delay in receiving Rs 25 billion advance corporate taxes, which were due on September 30, as well as the delay in payments of $530 million of the Coalition Support Fund from the US, caused the upsurge (in the deficit)," Tarin said.

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