ISLAMABAD: Finance Minister Shaukat Tarin announced on Friday that there would be no increase in the electricity tariff, while the tax collection target of 5.8 trillion rupees would be met thanks to the automation and changes in the tax system.
Closing debate on the federal budget, Tarin said the government will focus on a growth strategy to create new jobs and improve the income level of the population. “We have achieved stability and are heading towards inclusive and sustainable growth to create employment opportunities and increase the level of income,” he said, adding that the IMF has also been informed that the government has not would not increase the electricity tariff.
He said the government would tackle the circular debt problem by improving collections and controlling line losses through better management. Tarin said the tax on medical bills and generalist employee funds was also removed, while the tax on milk was also removed.
However, he said there would be no internet and texting tax, while users would only be charged 75 paisas for a call exceeding five minutes. The minister said the government has already introduced reforms in the Federal Revenue Council (FBT) to change the system through the automation of RBF and provide transparency to meet revenue collection targets.
He told the House that in the first 11 months of the current fiscal year, a collection of 4.1 trillion rupees had been made, while 4.7 trillion rupees would be collected by the end of the month in Classes.
The finance minister said Prime Minister Imran Khan had made bold and difficult decisions to steer the economy in the right direction, adding that despite the challenge of COVID-19, the country has achieved 4% growth over the course of of the current financial year thanks to its interventions in various fields. sectors, including industries, housing and construction and agriculture.
âThe actions taken by the government during the COVID-19 pandemic have been appreciated by the world. The government has gone for a smart lockdown and avoided a full lockdown so the economy continues to move, âhe said.
Tarin said the government itself was forecasting growth of 2.1%, the IMF for 1.3% and the World Bank for 2% while Prime Minister Imran Khan’s interventions resulted in economic growth of 4% which had fallen to 0.5%. He also announced a series of relief measures for different sectors.
He said the tax break previously given to the automotive sector for vehicles up to 850 cc is extended to 1,000 cc vehicles, while the tax imposed on medical bills and the GP fund has been withdrawn.
The minister said there would be no tax on registered computing platforms and only two percent for unregistered platforms. He said there would be a 17 percent tax on value-added gold products, while the poultry tax was reduced from 15 to 10 percent.
On textile products, the tax was reduced from 12 to 10 percent. Likewise, the tax rate on real estate has been reduced. As part of the construction package, the income tax ratio has been reduced from 35 percent to 20 percent.
He said tax breaks had also been given to oil refineries so that they could switch to Euro-5 fuel. The minister categorically stated that no tax had been imposed on flour and its products. Tarin said the budget gave hope to all levels of society. He said the budget included a comprehensive plan for the recovery of four to six million poor households.
Under this plan, these households will benefit from affordable housing. Rural households will benefit from interest-free loans of up to three hundred thousand rupees for agricultural productivity in addition to two hundred thousand rupees for the purchase of equipment.
He said five hundred thousand rupees of interest free loans will be given to every deserving household in urban areas to start their business. He said these poor households will also receive health cards. The minister said the allocation for the Ehsaas program has been increased to 260 billion rupees to provide assistance to disadvantaged segments of society.
He said the government will provide targeted subsidies to low-income groups on tariffs for electricity, flour, ghee and sugar. The minister said tax collection for the next fiscal year was set at Rs 5.8 trillion. âWe are making changes in the tax system and introducing automation. He said 12 withholding taxes were removed because they were regressive in nature.
Tarin said the government had increased the annual PSDP by 40% from 630 billion rupees to 900 billion rupees. He said transport and energy projects as well as the development of backward areas, including Balochistan, tribal areas and Gilgit-Baltistan, had been prioritized in the development plan to bring prosperity and reduce poverty. poverty.
He said $ 1.1 billion has been set aside for purchasing COVID vaccines, while Rs 5 billion has been set aside for the development of the electronic voting system. The minister stressed that Pakistan has become a net importer of food products and that the current government will now spend in the agricultural sector to achieve self-sufficiency.
He said a plan had been formulated in cooperation with the provinces to develop this sector, adding that cold stores and warehouses would be established and a network of agricultural shopping centers would be spread across the country to eliminate the role of intermediaries.
Regarding the industrial sector, he indicated that incentives of Rs40 billion will be granted in order to increase the competitiveness of this important sector of the economy. He said that tax relief had been given to the SME sector and that loans of Rs 100 billion would be given to them on a 9% mark-up, while the government would also bring the introduction of a new auto policy and of a âMeri Gari programâ.
He said the incentives for export-oriented industries will continue in the next fiscal year. âOur aim is to improve our export base by encouraging exports in different sectors,â he said. Tarin said he was pleased with the growth of the IT sector, saying the government’s goal is to increase exports to $ 6 billion to $ 8 billion over the next two to three years.
He said the government is also establishing Special Economic Zones (SEZs) under the China-Pakistan Economic Corridor Project. âWe have made a commitment with China to relocate their industries to these areas. Investments from other countries will also be made in these SEZs, âhe added.
He also announced that a sufficient budget would be allocated for the construction of a dam to improve the management of water and water reservoirs in the country. The Minister recalled that the PTI government had to approach the IMF because it inherited $ 28 billion in current account deficit and trade deficit due to the weakness of the currency and $ 30 billion in loans. .
“The IMF has agreed to make its program conditional on devaluing the rupee, increasing the discount rate to 13.25% and increasing electricity tariffs,” he said.
He said the government would also care for around six million families by providing interest-free loans of Rs 0.3 million to farmers and Rs 0.5 million in urban areas. In addition, he said the government would also allow people to own their homes.
Earlier, in giving their recommendations, members of the opposition called on the government to increase the salaries of its employees by 20 to 25 percent, withdraw tax from the GP Fund and reduce the burden of indirect taxes. .
Those who spoke before the finance minister’s speech included Hina Rabbani Khar, Shazia Marri, Rana Tanveer Hussain, Maulana Abdul Akbar Chitrali, Mohsin Dawar and others. The Chamber also offered Fateha for the souls of CF soldiers who died in a terrorist act in Sibbi.
Opposition members, while discussing the expenses charged for different ministries and institutions, said it was a budget by the rich and for the rich. Regarding the billed expenditure of 2.38 billion rupees to the National Assembly, Abdul Qadir Patel of PPP said that the chamber with its performance does not justify the same amount.
Closure of the debate on the finance bill 2021-22 in the Senate; Finance Minister Shaukat Tarin said the government has a profile of around 15 million suspected tax evaders, who will be persuaded through a third party to pay taxes or face the law.
The minister explained that they discovered through electricity and telephone bills and bank accounts that there were people who were not paying as much in taxes as they were supposed to pay. The minister said the government will have to maintain disincentives against willful defaulters.
Regarding concerns, mainly from the opposition in the House over the arrest of tax evaders, the minister argued that this has never been done in the country, but that it is a practice in other countries.
He substantiated his claim by referring to the arrest and conviction of Peter Graf, father of German tennis star Steffi Graf for tax evasion on his daughter’s income, as well as the arrests of the famous racing jockey from British horses Lester Piggott and the self-proclaimed American businesswoman. Leona Helmsley for tax evasion and evasion.
The minister assured senators that action against delinquencies would only be taken after due process of high-level review and acknowledged that this had become a big problem.
âTherefore, we will make it satisfactory for everyone,â he added. He also clarified that not the RBF, but third parties such as associations of traders, bankers and doctors, would talk to those people who pay huge utility bills and hold large sums in their bank accounts. Regarding the harassment of the FBR, the Minister maintained that the self-assessment had been reinstated.
He rejected claims by members of the opposition that the budget had been prepared by the IMF and had been read by it. Tarin said the IMF wanted to impose new taxes of 700 billion rupees, including a 150 billion rupee increase in income tax, but said it was opposed.