Pakistan asked by IMF to provide update on digital revenue system

The International Monetary Fund (IMF) has sought details of Pakistan's efforts to digitise its revenue system, including availing artificial intelligence to expand the tax system and increase revenue generation.

On Tuesday, alongside Minister of State for Revenue Ali Pervez Malik, State Bank Governor Jameel Ahmad and Federal Board of Revenue (FBR) Chairman Rashid Mehmood Langrial, Finance Minister Muhammad Aurangzeb met the IMF team headed by Pakistan mission’s chief Nathan Porter.

Sources privy to the matter stated that the IMF asked for a detailed explanation about the digitalisation of the FBR’s processes for revenue collection and the application of artificial intelligence for identifying and tracing the tax evaders. 

The fund believed using AI in the system with the help of firm experts would assist the authorities in finding the sources of income and business of tax evaders.

The loan lenders also asked authorities to share all details regarding the track-and-trace system. The initiative of digitising the revenue system has been taken on the demand of the IMF to boost revenue generation by strengthening taxation.

Cash-strapped Pakistan has been battling prolonged tax fraud for years and the government believed that the revenue collection could be smooth through digitalisation. 

As the country collected tax with manual documentation, it could not reach the targeted revenue in the first quarter with the Rs1 billion shortfall, which has been attributed to the declining inflation during briefing to the mission.

Today (Wednesday), the IMF delegation and Pakistan’s top office bearers will meet to discuss the performance of power and performance division.