IMF Rejects Pakistan’s Bid to Cut GST on Condoms, Prices Set to Remain High

Pakistan’s proposal to reduce taxes on condoms and other contraceptive products has been turned down by the International Monetary Fund (IMF), dealing a setback to the government’s efforts to make family planning items more affordable. As a result, the existing 18 per cent general sales tax (GST) on condoms will continue, keeping prices unchanged for consumers.

The request to lower or remove the tax was initiated by the federal government following instructions from Prime Minister Shehbaz Sharif, who had asked tax authorities to seek IMF approval for immediate relief on contraceptives. The move was aimed at easing costs for the public and supporting population control measures in a country facing rapid population growth. However, the IMF rejected the proposal, citing the conditions of Pakistan’s ongoing financial programme.

According to officials, the IMF maintained that tax changes of this nature cannot be introduced midway through the fiscal year. Any revisions, the fund said, can only be considered as part of the next federal budget discussions. The IMF also raised concerns over the potential loss of revenue, estimated to be several hundred million rupees, at a time when Pakistan is under pressure to meet strict revenue targets.

Similar proposals to cut GST on other essential items, including sanitary pads and baby diapers, were also declined. The fund reportedly warned that selective tax exemptions could complicate fiscal management and undermine broader reform goals agreed under the bailout programme. Despite these concerns, Pakistan remains bound by IMF conditions as it continues to rely on international financial assistance to stabilise its economy. For now, any relief on contraceptives will have to wait until the next budget cycle, leaving consumers to bear the existing tax burden.