Pakistan and the IMF agreed on most tax collection targets during policy-level talks in Islamabad on Wednesday.

According to the sources, the IMF team did not insist on a mini budget before the annual budget this year; rather the government would take steps to increase tax collection. The government will impose new taxes in the next budget and try to withdraw tax exemptions.

According to the FBR sources, the Pakistani team taking part in the talks told the IMF that tax collection has increased by 16 percent, local tax collection by 28 percent and local sales tax collection by 40 percent. Pakistan is also discussing with the IMF budget for the next year and possibilities of bringing down tax collection targets in the next fiscal year. Pakistan has agreed with the IMF to withdraw Rs280 billion tax exemptions in the budget for the next fiscal year. In order to increase revenue, the sources said, the government would increase non-tax income. Pakistan will add Rs400 billion to non-tax income. The policy-level talks between Pakistan and the IMF will conclude today (Thursday).