Pakistan amnesty draws 100,000 new tax filers, $450 million

Pakistan's government, struggling to lift revenues and cut ballooning public debt, registered around 100,000 new tax filers and expects to have raised about $450 million from a tax amnesty on hidden assets, the finance chief said on Thursday.

The announcement came a day after the International Monetary Fund gave final approval to a $6 billion loan package designed to shore up the economy while the government cuts debt and builds up dwindling foreign currency reserves. Finance chief Abdul Hafeez Shaikh said nearly 137,000 people had registered at the closure of the amnesty this week, of whom nearly 100,000 were first-time filers.

That was a significant total in a nation where less than 1% of the 208 million population file tax returns. In total, around 3 trillion rupees ($19.25 billion) of assets were declared and tax revenue worth around 70 billion rupees ($449.15 million) was collected.

Prime Minister Imran Khan introduced the amnesty on undeclared assets, part of a broader drive to widen Pakistan's notoriously narrow tax base, in a bid to identify high earners for more efficient tax collection. The move represented a turnaround for Khan who had accused previous governments of using amnesties to legitimize illegally acquired wealth hidden inside Pakistan and abroad.

Under the IMF agreement, approved on Wednesday, Pakistan has undertaken to drastically increase revenue mobilization by 4-5% of GDP at the federal and provincial level over three years. There have already been protests by opposition parties at the squeeze on household revenues.

Hafeez Shaikh said the IMF agreement would open up more funds from other lending agencies and help the broader economy. "Pakistan's economy will stabilize, and we will take on the path of progress," he said.

The government has set a target of raising 5.55 trillion rupees ($35.6 billion) in tax this year, an ambitious goal given that it missed a previous target of 4.4 trillion Pakistani rupees ($28.2 billion) by over 500 billion rupees ($3.2 billion).

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)