The finance ministry said on Sunday that the 11 targets, being categorised as “new conditions” under the ongoing programme with the International Monetary Fund (IMF), represented “continuity, sequencing, and deepening of Pakistan’s agreed reform agenda” rather than the “imposition of abrupt or unprecedented conditions”.

The ministry’s clarification follows reports of the government agreeing to 11 new targets, including additional tax measures and expenditure cuts from early next month, to make up for rising revenue shortfalls and to keep the $7 billion Extended Fund Facility (EFF) on track.

This was revealed in documents released by the IMF earlier this week, according to which commitment to the new or revised structural benchmarks, together with completion of two “prior actions”, enabled the conclusion of a staff-level agreement on the second review of the EFF and its approval by the IMF Executive Board for the disbursement of about $1.2bn for Pakistan on December 9.

A press release issued by the finance ministry today said that it had “clarified the intent, context, and continuity of reform measures under Pakistan’s IMF Extended Fund Facility programme, particularly in response to recent commentary regarding so-called “new conditions”.

“The purpose is to reaffirm that the measures referenced are part of a phased, medium-term reform agenda agreed with the IMF, many of which are extensions or logical progressions of reforms already initiated by the Government of Pakistan,” the press release read.

It said that the EFF was designed to support countries in implementing medium-term structural reforms aimed at achieving agreed policy objectives.

“These reforms are implemented in a sequenced and step-by-step manner over the duration of the programme,” it said. “Each review builds upon prior actions to ensure that the ultimate policy goals agreed at the outset of the program are achieved.

“Accordingly, actions under the EFF are structured as logical steps, with additional measures incorporated at each successive review.”

According to the statement, the MEFP finalised after the second EFF review supplements the MEFP agreed during the first review and reflects this phased approach.

During IMF discussions and negotiations, the government presents its planned policy reform initiatives, it said. Where the IMF assesses that these initiatives contribute to the agreed programme objectives, they are incorporated into the MEFP.

“As a result, many of the structural benchmarks and actions included in the latest MEFP are derived from reforms already undertaken or initiated by the government of Pakistan, rather than being externally imposed or newly introduced conditions,” it added.

The ministry issued clarifications on the eleven measures recently characterised as “new conditions”.

Regarding the public disclosure of asset declarations of civil servants, it said that this reform had been part of the EFF programme since the initial MEFP in May 2024.

“The current structural benchmark represents the second step, following the successful legislative amendment to the Civil Servants Act, 1973,” it said.

Commitments to strengthening the National Accountability Bureau’s (NAB) operational effectiveness and independence were also agreed during earlier reviews, it said, including coordination with provincial anti-corruption establishments.

“The development of action plans for high-risk agencies is a continuation of this commitment and runs parallel to, rather than stemming from, the Governance and Corruption Diagnostic Assessment Report,” the ministry statement added.

On empowering provincial anti-corruption establishments, it said that allowing these bodies access to financial intelligence aligned with the ongoing Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) reform agenda, which had been “integral to the EFF since its inception”.

The ministry further said that strengthening remittance inflows was “critical to Pakistan’s external stability”.

“Following measures to curb informal channels, remittances increased by 26 per cent year-on-year from FY24 to FY25, with a further increase of 9.3 percent projected for FY26,” it said.

“The government, in coordination with the State Bank of Pakistan (SBP), has been working to remove structural bottlenecks in cross-border payments. The IMF has built upon these efforts by incorporating them into the MEFP,” it added.

The ministry also said that the IMF staff report that had been published in May 2025 had recommended a comprehensive study to identify bottlenecks in the local currency bond market to broaden the investor base. This recommendation has now been formalised as a structural benchmark, according to the statement.

On the deregulation of the sugar industry, it said that the initiative originated from the government.

“A task force, notified by the prime minister’s office and chaired by the minister for power, has been mandated to recommend full liberalisation of the sugar market and propose a national policy in consultation with provinces. Given its alignment with the EFF objective of reducing government intervention in commodity markets, the IMF has included this initiative as a structural benchmark,” it said.

The statement added that the development of a comprehensive roadmap for the Federal Board of Revenue (FBR) was part of a broader domestic resource mobilisation reform agenda led directly by the prime minister.

“Key actions already taken include approval of the transformation plan, establishment of the Tax Policy Office, and strengthening of compliance risk management. This structural benchmark builds upon commitments made with the IMF in May 2024 and March 2025,” it said.

Further, the ministry called the requirement to develop and publish a medium-term tax reform strategy “a logical extension of earlier reforms, particularly the establishment and operationalisation of the Tax Policy Office to separate tax policy formulation from FBR’s operational functions”.

It said that the privatisation of distribution companies (Discos) had also been a core component of the EFF programme since its inception, adding that it was “envisaged to occur in phases”.

“Finalising preconditions for private-sector participation in Hesco (Hyderabad Electric Supply Company) and Sepco (Sukkur Electric Power Company) represents the next step following initiation of the process for the first batch of Discos. Additionally, the signing of Public Service Obligation (PSO) agreements with the seven largest entities reiterates an earlier programme commitment,” it added.

Regarding regulatory reforms and corporate compliance, it said, “Amendments to the Companies Act, 2017 to strengthen compliance for unlisted firms are part of the broader regulatory reform agenda aimed at improving the business climate, an objective embedded in the EFF from the outset.”

It added that, similarly, the structural benchmark related to a concept note for amendments to the Special Economic Zones (SEZ) Act follows the successful completion of a prior benchmark involving an SEZ assessment study.

Finally, it said that contingency measures to address potential revenue shortfalls had also been part of the MEFP framework since May 2024, adding that the initial MEFP itself included a structural benchmark for introducing a 5 per cent Federal Excise Duty on fertiliser and pesticides.

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https://www.dawn.com/news/1960997

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ISLAMABAD: The Regional Tax Office (RTO) Peshawar has sealed multiple godowns and seized non-duty paid raw tobacco, involving a tax evasion of Rs19 billion in District Mardan, Khyber Pakhtunkhwa, as part of a broader crackdown on tax evasion in the tobacco sector.

This is one of the several attempts of the Federal Board of Revenue (FBR) to decisively curb illicit practices in the tobacco and cigarette sector and to ensure strict enforcement of tax laws across the entire supply chain, including raw materials.

An official announcement said the RTO Peshawar carried out an operation, resulting in the seizure of approximately 2.75m kilogrammes of raw tobacco from the godowns of Khyber Tobacco Company.

The recovered tobacco, which constitutes the basic raw material for cigarette manufacturing, was found to be non-duty paid. The estimated evaded Federal Excise Duty on the seized goods amounts to approximately Rs1.1bn. The company is a known manufacturer of cigarette brands, including Kissan and Gold Street Classic.

Published in Dawn, December 14th, 2025

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