Pakistan, May 20 -- The Pakistani government and the International Monetary Fund (IMF) have agreed to increase petroleum-related taxes in the next fiscal year. Sources say both sides discussed applying a Rs5 carbon levy on petroleum products. The proposal also includes raising the petroleum levy to more than Rs100 per litre. These steps aim to meet IMF revenue targets.

Besides fuel taxes, the IMF asked for broader tax reforms. One key demand is ending tax exemptions for the former FATA and PATA regions. These areas currently enjoy special tax relief. However, the IMF believes all regions should follow the same rules. This move could increase overall tax collection.

The IMF also recommended a major change in vehicle import duties. It wan...