ISLAMABAD: Miftah Ismail, a central figure in the Awam Pakistan Party and former Finance Minister, has urged the government to eliminate taxes on electricity bills to provide immediate relief to domestic consumers.
In an interview with a local TV channel, Ismail stressed the importance of renegotiating terms with Independent Power Producers (IPPs) to address financial deficits and recover dues from defaulters. He recalled similar negotiations during the PTI administration, suggesting that revisiting these discussions could significantly reduce the tax burden on consumers.
Ismail proposed the removal of four types of taxes from electricity bills, estimating this would lead to a Rs 400 billion deficit. However, he suggested this shortfall could be offset using the Rs 1,100 billion from the Public Sector Development Programme (PSDP) fund, which could also alleviate IMF concerns regarding fiscal deficits.
The former Finance Minister pointed to the potential for additional relief in Sindh through the use of wind-generated electricity, which could be more extensively harnessed with improved cable infrastructure. He criticized the continued reliance on furnace oil for power generation and advocated for lower electricity tariffs to increase consumption and reduce capacity charges.
Ismail expressed confidence that with effective negotiation, the IMF could be persuaded to approve these tax reductions, potentially leading to a positive primary deficit of 1% of GDP.
