Pakistan Urged by IMF to Tax Crypto Gains for $3 Billion Bailout
Mar 18, 2024
The International Monetary Fund (IMF) has recommended that Pakistan impose Capital Gains Tax (CGT) on cryptocurrency investments as part of the conditions for receiving a $3 billion bailout. During discussions surrounding a $3-billion stand-by arrangement (SBA), the IMF advised Pakistan's Federal Board of Revenue (FBR) to introduce taxes on crypto capital gains, along with reviewing taxation on real estate and listed securities. The adjustments in tax rates are aimed at collecting annual taxes on capital gains from real estate assets, regardless of whether the owner decides to sell or retain the property. Additionally, stricter tracking and reporting requirements for property developers may be enforced, supported by significant fines for non-compliance, in an effort to implement new tax regulations in the real estate market. These recommendations are anticipated to be incorporated into Pakistan's budget for the fiscal year 2024–2025 as part of the Extended Fund Facility (EFF) bailout package. The $3 billion IMF aid aims to stabilise Pakistan's hyperinflated fiat economy, which has faced challenges due to geopolitical tensions, natural disasters, and unstable governance. The disbursement of around $1.1 billion is contingent upon Pakistan agreeing to these conditions outlined by the IMF during the four-day review that began on March 14.
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