Finance Minister Muhammad Aurangzeb underscored the pivotal role of taxes in sustaining national economies during a press briefing on Tuesday, as Pakistan unveiled its Economic Survey 2023-24, a precursor to the upcoming federal budget.
Minister Aurangzeb highlighted that while philanthropy aids institutions like schools and hospitals, countries themselves rely on consistent tax revenues for operational sustainability. His remarks came as Pakistan reported a GDP growth of 2.38%, exceeding the projected target of 2% for the fiscal year.
“We are entering the new fiscal year on a stronger footing externally, with manageable debt rollovers and improved borrowing prospects,” Minister Aurangzeb stated, emphasizing the country’s enhanced financial position compared to the previous year.
The finance minister acknowledged challenges faced in the previous fiscal period, including currency depreciation and reduced foreign exchange reserves, but noted improvements in stabilizing the national currency and securing the current account surplus in recent months.
He credited the agriculture sector for buoying economic growth amid challenges in other sectors like manufacturing, which faced setbacks due to high interest rates and energy constraints.
Minister Aurangzeb also addressed ongoing negotiations with the International Monetary Fund (IMF) for a potential bailout package, indicating positive dialogue and highlighting the necessity of implementing fiscal policies rigorously to meet IMF targets.
Looking ahead, Aurangzeb stressed the need to increase the tax-to-GDP ratio and improve revenue collection, noting that public corporations would not be exempt from contributing to economic stability.
The Economic Survey precedes the federal budget presentation scheduled for June 12, with expectations of ambitious fiscal targets aimed at securing an IMF bailout to stabilize Pakistan’s sluggish economy.
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