IMF Urges Pakistan to Impose Crypto Gains Tax for $3B Bailout Financing

The Federal Board of Revenue (FBR) of Pakistan has been urged by the International Monetary Fund (IMF) to implement a Capital Gains Tax (CGT) on cryptocurrency investments in order to qualify for $3 billion in bailout funds.
As part of the review discussions for a $3 billion stand-by arrangement (SBA), the IMF has advised the FBR to impose taxes on crypto capital gains. The IMF has also requested a review of the taxation system for real estate and listed securities, according to local news outlet The News.
The recommended adjustment in tax rates aims to ensure that yearly taxes are collected on capital gains from real estate assets, regardless of whether the owner chooses to sell or retain the property. In addition, property developers may be subject to stricter tracking and reporting requirements, backed by hefty fines for non-compliance, in order to enforce new tax regulations in the real estate market.
Reports suggest that these recommendations from the IMF could be included in the upcoming bailout package under the Extended Fund Facility (EFF). Consequently, Pakistan’s budget for the fiscal year 2024-2025 may officially introduce a strict crypto tax on capital gains.
The $3 billion IMF aid is intended to stabilize Pakistan’s hyperinflated fiat economy and prevent a debt default, which was caused by geopolitical tensions, natural disasters, and unstable national governance, among other factors.
The four-day IMF review, which began on March 14, will result in the disbursement of approximately $1.1 billion if Pakistan agrees to the conditions.
The call for taxing crypto capital gains comes almost a year after Aisha Ghaus Pasha, the Minister of State for Finance and Revenue, stated that the country would never legalize crypto trading.
The crypto community in Pakistan has challenged the government’s decision to ban crypto trading based on the IMF’s recommendation.
Pakistan is placing its bets on artificial intelligence (AI) and aims to produce 1 million AI-trained IT graduates by 2027.
The country’s national AI policy draft demonstrates Pakistan’s commitment to integrating AI for the betterment of the public and the nation. It sets 15 targets with timelines ranging from 2023 to 2028.
To support these initiatives, Pakistan plans to establish a National AI Fund using the Ministry of IT and Telecom’s underutilized resources and funds.