Lahore, Pakistan, July 31, 2013—IFC,
a member of the World Bank Group, has signed an agreement to advise the
Government of Punjab as it reforms the province's sales tax system, part
of a wider effort to encourage economic development in Pakistan.
IFC will support the government as it
streamlines sales tax regulations, improves collection procedures, and
makes it easier for small and medium business to comply with tax regulations.
The initiative will help boost government revenues while providing
business with transparent and easy-to-understand tax guidelines. The project
comes as newly-elected governments in Islamabad and Lahore launch wide-ranging
reform programs to help reinvigorate growth and make the Punjab a leading
"In the last year, the Punjab Revenue
Authority (PRA) has made great strides in the collection of sales tax,"
said Iftikhar Qutab, PRA Chairman. "This agreement will help
further those efforts, providing a solid fiscal foundation for the province."
The project is part of an IFC effort
to help governments across the Middle East and North Africa modernize their
regulations to ease the regulatory burden on firms and encourage economic
"It is vital for regional governments
to have a broad tax base; without it, they will struggle to achieve their
policy objectives, including delivering the infrastructure and social services
needed to support growth," said Magdi M. Amin, IFC’s Manager for
Investment Climate in the Middle East and North Africa. "The key to
broadening that tax base is implementing reforms that are simple for businesses
to follow, which this project is designed to do."
IFC and the Punjab government held a
signing ceremony last week chaired by Chief Minister Mian Muhammad Shahbaz
Sharif and attended by Finance Secretary Jehanzeb Khan.
The initiative is part of IFC's strategy
in Pakistan to stoke economic development by supporting regulatory reforms
and encouraging the growth of the private sector. Through a combination
of investments and advisory services, IFC is helping to bolster power supplies,
increase agricultural productivity, boost regional trade, and support smaller
businesses, among a host of other initiatives.
IFC, a member of the World Bank Group, is the largest global development
institution focused exclusively on the private sector. We help developing
countries achieve sustainable growth by financing investment, mobilizing
capital in international financial markets, and providing advisory services
to businesses and governments. In FY12, our investments reached an all-time
high of more than $20 billion, leveraging the power of the private sector
to create jobs, spark innovation, and tackle the world’s most pressing
development challenges. For more information, visit www.ifc.org.