{"id":24711,"date":"2023-11-15T04:40:05","date_gmt":"2023-11-15T04:40:05","guid":{"rendered":"https:\/\/news.pakistaninewspaperlist.com\/pakistan-prepares-to-impose-tax-on-extraordinary-profits-of-banks\/"},"modified":"2023-11-15T04:40:05","modified_gmt":"2023-11-15T04:40:05","slug":"pakistan-prepares-to-impose-tax-on-extraordinary-profits-of-banks","status":"publish","type":"post","link":"https:\/\/pakistaninewspaperlist.com\/news\/pakistan-prepares-to-impose-tax-on-extraordinary-profits-of-banks\/","title":{"rendered":"Pakistan prepares to impose tax on \u2018extraordinary profits\u2019 of banks"},"content":{"rendered":"
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ISLAMABAD: The federal government is preparing to impose tax on \u2018extraordinary profits\u2019 of commercial banks in an effort to enhance \u2018tax recovery\u2019 as Pakistan eyed second tranche worth $710 million amid talks with International Monetary Fund (IMF), ARY News reported on Tuesday, citing sources.<\/strong><\/p>\n

Pakistan is operating under a caretaker government after an IMF loan programme, approved in July, helped avert a sovereign debt default.<\/p>\n

Under the $3 billion standby arrangement (SBA), Pakistan received $1.2 billion from the IMF as the first tranche in July.<\/p>\n

Last week, an IMF mission kicked off its review for the second loan tranche, which is expected to continue till Dec 15. A successful review would unlock $710 million for the country in December.<\/p>\n

Sources told ARY News that the federal cabinet, set to meet tomorrow (Wednesday), will deliberate on a summary, seeking imposing of tax on \u2018extraordinary profits\u2019 of commercial banks.<\/p>\n

The authorities have proposed 40 percent of taxes to be imposed on earnings of banks, from which the Federal Bureau of Revenue (FBR) can collect around Rs50 billion, they added.<\/p>\n

Sources further claimed that banks have earned an \u2018extraordinary profit\u2019 of around Rs110 billion in two years \u2013 2021 and 2022.<\/p>\n

Read More:\u00a0IMF demands \u2018Do More\u2019 from Pakistan for tax recovery<\/a><\/em><\/strong><\/p>\n

It is pertinent to mention here that the International Monetary Fund\u2019s (IMF) review mission earlier met with Pakistani authorities and commended the government on its progress toward economic recovery.<\/p>\n

\u201cNathan Porter, IMF Mission Chief, appreciated the government\u2019s commitment to meeting the first-quarter targets, and commended the government\u2019s efforts and measures taken in some critical areas,\u201d the ministry said.<\/p>\n

The ministry\u2019s statement added that caretaker Finance Minister Shamshad Akhtar briefed the IMF mission on fiscal measures and discussed reforms and measures undertaken by Pakistan\u2019s taxation body, as well as the government\u2019s strategies to address its circular debt issue.<\/p>\n

Circular debt is a form of public debt that builds up in the power sector due to subsidies and unpaid bills.<\/p>\n

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