The Finance Bill 2023, more commonly known as the new mini-budget, was signed by President Arif Alvi on Thursday morning.
The bill will bring Rs170 billion in new taxes to fulfill IMF conditions.
The mini-budget was passed after an IMF delegation visited Pakistan towards the end of January and engaged in technical and policy-level talks with government officials. The IMF floated numerous conditions but no agreement could be reached. Talks are continuing virtually.
Pakistan is looking towards the IMF to secure a bailout tranche to save its ailing economy from default. The country has also looked towards friendly countries for aid, but the countries are reportedly looking towards the IMF’s decision first.
A new wave of inflation is expected after the measures in the finance bill. Among these measures is an increase in the General Sales Tax from 17% to 18%, affecting a wide range of consumer goods. Excise duties on luxury items have also been increased.
The government has also made massive increases in the prices of petrol and diesel in recent days, partly forced by the freefall in the rupee’s value against the dollar.
The president had earlier declined to make the sign the measures into effect through an ordinance.
