Yahoo Finance IMF raises concerns over petroleum product smuggling in Pakistan
The International Monetary Fund (IMF) has expressed serious concerns over the extensive smuggling of petroleum products in Pakistan, leading to significant revenue shortfalls, according to sources within the Federal Board of Revenue. The international lender has demanded an explanation and a comprehensive report from Pakistan's Ministry of Finance and the Federal Board of Revenue (FBR) on the measures taken to curb this illicit activity.
On Tuesday, ARY News reported that the IMF has sought details from the finance ministry and the FBR regarding steps taken so far to halt the monthly smuggling of petroleum products amounting to 143 million litres or approximately 120,000 tons.
The IMF has highlighted the necessity for a significant expansion in both the number and capacity of customs and law enforcement personnel at border areas. This move is seen as crucial in addressing a staggering loss of more than Rs. 10 billion ($59 million) in customs duties and levies directly attributed to the smuggling of petroleum products.
Failure to stop this smuggling could result in a significant revenue shortfall, warned the IMF. It has issued direct instructions to both the FBR and the Finance Ministry to take immediate and robust steps to enhance revenue collection and curb smuggling as a top priority.
Earlier this month, Caretaker Finance Minister Shamshad Akhtar affirmed that the government will fulfill its tax collection agreement with the IMF. In a press conference with caretaker federal ministers, Akhtar stated that despite inheriting several challenges, the caretaker setup was not daunted by them and was tackling them one by one. She added that their strategy was to prudently manage these challenges, control expenditures, and enhance revenues, which would help improve the situation.
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