Cash-strapped Pakistan will impose new taxes of Rs 170 billion this month in a bid for a massive bailout, officials and analysts said Monday, even as they warned the new taxes could accelerate the country's spiraling inflation.
The dire outlook from economists and political analysts comes after the International Monetary Fund (IMF) delayed the release of a crucial USD 1.1 billion portion of a 2019 deal worth USD 6 billion, on hold since December over Pakistan's failure to meet the terms. The latest round of the talks between Pakistan and the IMF concluded Friday with the fund recommending steps including imposing new taxes.
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"The imposition of more taxes means tough days are ahead for the majority of the people in Pakistan who are already facing higher food and energy costs, but there is no other way out if Pakistan needs the IMF loans, and Pakistan desperately needs it," said Ehtisham-ul-Haq, a veteran economist.
The stalemate in talks between IMF and Pakistan was seen as a blow to the government of Prime Minister Shahbaz Sharif, who is struggling to avoid a default amid a worsening economic crisis and a surge in militant violence. Pakistan already is struggling with recovery from record-breaking floods, which killed 1,739 people in the summer of 2022 and destroyed 2 million homes.
Milk and Flour prices in Pakistan are skyrocketing
Milk and flour are included in the basic food item list. There is a continuous crisis regarding milk and flour in Pakistan. Atta or flour is being sold at Rs 120 per kg, while milk is being sold at Rs 110 per litre. At the same time, pulses are also seen touching the figure of 200.
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Belongings and Price Per Kg/Litre
Flour: 120
Rice: 240
Moong: 155-172
Sugar: 90
Chicken: 780
Milk: 110-160
Cooking Oil: 480-490
Lemon: 100
Apple: 110-320
Ghee: 1800-2500
Mutton: 1100
Curd: 115
Green Tea: 1100
Tomato: 40-60
Petrol: 298
The government insists that it will impose new taxes in such a way that poor people are not affected. The new taxes will be imposed on those who can afford to pay additional taxes to save the economy, the government said.
