Govt Presents Pro-poor, Business Friendly, Growth Oriented Budget

Govt presents pro-poor, business friendly, growth oriented budget

ISLAMABAD, (UrduPoint / Pakistan Point News - 12th Jun, 2021 ) :The government has presented a pro-people, business-friendly and growth-oriented budget with the clear-cut focus on growth and bottom-up approach as envisaged by Prime Minister Imran Khan.

The budget is meant to strike a balance between fiscal deficits due to the Covid-19 pandemic and boosting growth of the economy, keeping Primary balance at a sustainable level.

The vulnerable segments of the society have been protected under the Ehsaas Programme while resources are mobilized with required changes in tax structure.

The development budget has been kept at an adequate level to stimulate sustainable economic growth coupled with policy support. The crucial housing initiatives has been adequately funded, including the Naya Pakistan Housing Project that would boost the construction sector.

Similarly,funding for special areas i.e. erstwhile FATA, Azad Jammu & Kashmir and Gilgit Baltistan has been ensured for their speedy development.

Special initiatives led by the prime minister like Kamyab Jawan, Sehat Card, Billion Tree Tsunami, etc will continue while austerity measures will be continued and non-productive expenditure rationalization will be done with focus on provision of targeted subsidies only.

Moreover, the provinces are persuaded to fulfill their funding commitments made at the time of the merger of erstwhile FATA (Federally Administered Tribal Areas) and the Federation is being strengthened � leaving no one behind by undertaking GB Development Package, Karachi Transformation Plan in next three years and inter-provincial coordination and implementation of Sustainable Development Goals (SDGs).

The government has also taken various policy initiatives in the manufacturing sector namely Electric Vehicles Policy, National SME Policy, and Textile and Apparel Policy (2020-25).

It has also ensured support for 4-6 million low-income households, through interest free business loans (upto Rs 5 lakh), interest free farming loans (upto Rs.2.5 lakh), agri-equipment loans (upto Rs 2 lakh), and technical training for one person from each household for youth empowerment.

Likewise, the government has provided subsidy of Rs 300,000 for house construction for low-income individuals (Rs 33 billion allocated) and increased the development budget from Rs 630 billion to Rs 900 billion (40% increase).

In the food security sector, the government has set aside Rs 1 billion for the Locust Emergency and Food Security Project, Rs 2 billion for enhancing productivity of rice, wheat, cotton, sugarcane and pulses, Rs 1 billion for enhancement of olive cultivation on commercial scale, and Rs 3 billion for improvement of water courses.

he government has also allocated Rs 100 billion for the construction of four hydro power dams (Dasu, Diamer, Mohmand and Neelum Jhelum).

Gross revenues for 2021-22 have been estimated at Rs 7,909 billion, with FBR revenues estimated to grow by 24% from Rs 4,691 billion to Rs 5829 billion.

Similarly, federal expenditures are budgeted at Rs 8,487 billion as compared to Rs 7,341 billion, subsidies are projected at Rs 682 billion (last year Rs 430 billion) and allocation of Rs 260 billion is made for Ehsaas (last year Rs 210 billion).

The government has also earmarked $ 1.1 billion for COVID vaccination, Universal Health Coverage in collaboration with the provinces, Rs 12 billion for collateral free lending to SMEs (Small Medium Enterprises), Rs 10 billion for Kamyab Pakistan Programme, Rs 100 million for anti-rape fund, and Rs 66 billion for Higher education Commission (HEC).

The government also introduced self-assessment scheme, E-audit system and a strict adherence to no harassment for taxpayers.

No new taxes are levied on salaried class, while third party audits would be promoted and requirements for tax compliance are also minimized. The focus would be on broadening of tax base.

The government has also proposed expansion of GST (General Sales Tax) base and introduction of new simplified Tax Return Form and new tax code, withdrawal of FED (Federal Excise Duty) and reduction of sales tax on locally manufactured cars upto 850cc, allowing zero rating to export of IT (Information Technology) services, exemption to SILOS for storage of agriculture products, and reduction in withholding tax regime by 40%.

Exemptions on COVID-19 related medical equipment / items have been extended for six months, for making Pakistan a tourism friendly destination in the world, relief / concessionary measures of more than Rs. 45 billion have been given.

The government also announced relief measures for federal government employees by providing 10% ad-hoc relief allowance to all Federal Government employees and pensioners with effect from July 1, 2021.

Similarly the minimum wage has also been increased to Rs 20,000 per month.