IMF Reviews Pakistan’s Tax Reforms, Judicial Efficiency in High-Level Meetings
Islamabad – Representatives from the Federal Board of Revenue (FBR) and the Supreme Court Bar Association (SCBA) held detailed discussions with a visiting International Monetary Fund (IMF) mission in Islamabad on Monday. The meetings focused on a wide range of governance-related issues including tax reform, judicial efficiency, contract enforcement, and property rights protection.
The IMF Governance and Diagnostic Assessment Mission, currently in Pakistan, is engaging with various government departments to evaluate institutional frameworks around fiscal and tax policy, corruption prevention, procurement practices, audit mechanisms, and anti-money laundering efforts.
According to official sources, a technical team from the IMF met with FBR officials to review Pakistan’s Tax Transformation Plan. This plan, previously approved by the Prime Minister, aims to reduce the country’s tax gap, which currently exceeds Rs7 trillion, by increasing actual revenue collection and implementing stronger enforcement measures.
Focus on Digitalization and Enforcement
The tax reform strategy focuses heavily on digital transformation. Key objectives include the development of Model Tax Offices (MTOs), the strengthening of enforcement and intelligence directorates to combat smuggling, and promoting transparency in financial transactions.
To improve documentation and compliance, the FBR plans to implement digital invoicing and issue notices to unregistered entities, accompanied by penalties for noncompliance. A key component also includes discouraging the use of cash currency, which currently constitutes 25% of the money in circulation in Pakistan—significantly higher than neighboring countries such as India (14%) and Bangladesh (14%).
FBR officials shared an initial briefing with the IMF technical team and noted that further sessions are scheduled, concluding with a final meeting between the IMF and the FBR Chairman.
Judicial Efficiency and Governance Reforms
In a parallel session, another IMF delegation met with the Supreme Court Bar Association (SCBA) to discuss ways to enhance judicial efficiency and support property rights enforcement—key factors for promoting economic growth and investor confidence.
SCBA President Mian Mohammad Rauf Atta highlighted ongoing judicial and legislative initiatives aimed at strengthening the justice system. On the judicial front, he referenced reforms led by the Chief Justice of Pakistan, including the introduction of e-filing systems, improvements to case management, faster case disposals, and the use of video conferencing for hearings.
Legislatively, the 26th Constitutional Amendment was discussed as a key step towards ensuring greater judicial independence and efficiency. Additional reforms include the appointment of specialist judges, the establishment of tax tribunals, and the promotion of Alternative Dispute Resolution (ADR) mechanisms to facilitate quicker, community-level dispute resolutions.
Enhancing Investor Confidence
Regarding contract enforcement, SCBA officials acknowledged some procedural delays but assured the IMF team that the government is actively working to create a more investor-friendly environment. Measures such as the establishment of special benches for commercial disputes and the strengthening of anti-encroachment laws were shared as part of ongoing efforts to support property rights and encourage foreign direct investment (FDI).
The IMF delegation plans to share a detailed questionnaire with SCBA, requesting further input, recommendations, and data related to the topics discussed.
