The International Monetary Fund (IMF) has urged the Pakistani government to take decisive action against tax evasion in the real estate sector as discussions to unlock a $1 billion loan tranche commence in Islamabad. The nine-member IMF mission, led by Nathan Porter, arrived in Pakistan today to evaluate the country’s economic performance and determine the release of the next tranche under the $7 billion loan program.

According to sources, the talks have begun, with the IMF emphasizing the need to address the misdeclaring of property values. As part of the proposed reforms, the Pakistani government has assured the IMF that it will activate the Real Estate Regulatory Authority.

The IMF mission is expected to stay in Pakistan for about two weeks to assess the economic situation further. Last month, the IMF team held discussions with Pakistani officials regarding climate finance and reportedly opposed sales tax concessions on the local sale of electric vehicle parts, suggesting that routine tax rates should apply under the new electric vehicle policy.