The technical-level talks between Pakistan and the International Monetary Fund (IMF) on the federal budget for the fiscal year 2025-26 are expected to begin next week, according to sources.
The international lender will be taken into confidence regarding the tax reforms, which include proposals such as withdrawing tax exemptions for new Special Economic Zones (SEZs), imposing a carbon levy on petrol and diesel, and providing incentives for electric vehicles. Work on the new tax framework for the next fiscal year is said to be progressing rapidly.
Senior officials from the Ministry of Finance and the Federal Board of Revenue (FBR) will participate in the negotiations.
Sources revealed that the government has decided not to extend tax incentives to new economic and export processing zones, while existing tax benefits for SEZs will be phased out by 2035.
As part of the climate financing programme, a proposal to introduce a carbon levy of Rs5 per litre on petrol and diesel is under consideration, the sources said.
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