ISLAMABAD - Admitting his failure in creating job opportunities, Federal Minister for Finance and Economic Affairs Dr Abdul Hafeez Shaikh on Saturday said that the government has provided tax relief to the people in the budget 2011-2012 by abolishing Special Excise Duty, Regulatory Duty, reducing General Sales Tax (GST) by one per cent and by lifting the income tax threshold. Addressing a post-budget press conference along with his entire economic team, the finance minister said that the government does not want to exceed its expenditures than its income and it tried to reduce its expenditures, however expenditures like defence and loan and interest repayments could not be curtailed, he added. He said that the government has not only frozen its expenditures but reduced them to a considerable level to check fiscal deficit. The government has been trying to improve the subsidy system, as it should be targeted subsidies to provide relief to the relevant segments, the Finance Minister maintained. The government has allocated Rs 50 billion for the Benazir Income Support Programme (BISP) for the upcoming fiscal year 2011-2012 against the Rs 35 billion of the outgoing financial year. He dispelled the impression that budget is prepared on the International Monetary Funds dictation. He admitted that the government could not provide job opportunities and we have decided to work in this year, as the government has given five years tax relief to such investors who operate his factory/industry at his own investment instead of loans. The Federal Minister was of the view that a budget of a single year could not resolve the issues of the past 62 years. Talking about the taxation measures, the Finance Minister said that the government has decided to lessen the taxation burden on the masses and in this regard we have abolished the Special Excise Duty on 100 commodities and also eliminated Regulatory Duty (RD) on 392 items. However, he said, RD would be imposed only on five items including luxuries vehicles, cigarettes, arms and ammunition and imported bathroom fittings. He further said that the government has also abolished Federal Excise Duty on 15 items and FED would be completely eliminated in next three years. The FED on cement is reduce to Rs 500 metric ton from Rs 700 metric ton and it would be further reduce in the next two years, he added. Talking about income tax, Dr Hafeez said that the minimum income tax level has been increased to Rs 350,000 from Rs 300,000 in order to facilitate the masses. The government has also decided to reduce the General Sales Tax rate by one per cent i.e. 17 to 16 per cent, which will cost Rs 36 billion to the FBR, he said and added that the government wanted to bring every exempted sector under the tax net as already seen in March when the government brought some sectors in the tax net. He observed that only 1.5 million people in the country filed their income tax returns. This is the sector (income tax) from where revenue would be generated, as the government has already traced 2.3 million non-taxpayer and the government would issue notices to 0.7 million during the upcoming financial year, he maintained. The government would put taxation burden on such people, who are enjoying immunity for the last 62 years, the Finance Minister said and added that 2.3 million are those who are living in posh areas, having at least two banks, enjoying foreign trips for at least two months a year but never pay their due taxes. Talking about the Federal Board of Revenue (FBR), the Finance Minister said that nobody including the President, the Prime Minister or others are interfering in FBR matters. He was of the view that FBRs refund system has improved over the last few months, as it refunded Rs 40 billion this year against Rs 16 billion of the last year. The Finance Minister expressed his resolve to achieve the revised revenue collection target of Rs 1588 billion for the outgoing financial year and said that FBR has to collect Rs 270 billion in June in order to reach its target. To a question about agricultural income tax, the Minister said that it is provincial subject and the Prime Minister already constituted a committee for bringing improvement in its collection, as this tax is already imposed in the provinces. President Asif Ali Zardari also directed broadening the tax net and bringing the agriculture sector under the net. To another query, he said that debt to GDP is around 55.5 per cent. He said the government needed funds for their rehabilitation flood-affected people and it was everyones responsibility to pay taxes so that positive change could be brought in the lives of the millions affected. Dr Hafeez said floods had damaged around 1.6 million houses in different areas last year, besides affecting the standing crops and killing livestock. The floods had caused losses of more than $10 billion. We cannot leave fellow Pakistanis in the lurch and are doing and would do the utmost for their betterment, he said. He said efforts were made to resolve the circular debt issue and overcome energy shortage. He said the government has provided subsidy of Rs180 billion this year against Rs250 billion last year, adding that reduction in subsidy would not affect the common man. He dispelled the impression that allocation for education and health have been reduced saying that finances in these areas are being given to provinces and now they are responsible to bring development in health, education and other social sectors. However, the federal government has still allocated funds for the Higher Education Commission (HEC) and also for some health related programmes. Agencies add:Dr Hafeez said the power sector is still a big financial burden on the government. He said budget allocations for the defence of the country are essential, though he emphasised that there should be checks and balances. He said the security of the country is the top priority of the government and expenditure on security cannot be brought down. He said petrol allowance of government employees was curtailed by half, fresh recruitments banned and purchase of new vehicles and furniture stopped. He said the government also cut the development programme. He said the overall development programme totalled Rs 462 billion and pointed out that though there was cut at federal level but there was increase by the provincial governments. He said the subsidies provision have been rationalised and the government provided Rs35 billion for 3.5 to 4 million poor families. Turning to the power sector, the finance minister hoped improvement, saying that new managements have brought in companies and loadshedding has been curtailed. We are now getting positive results.