ISLAMABAD - Pakistan Tehreek-e-Insaf government is going to present its third budget for the fiscal year 2021-22, with an estimated outlay of around Rs8 trillion, Friday(today).
The National Assembly is already in session where the budget for the fiscal year 2021-22 would be presented, official sources said. The PTI led coalition government is all set to present its third annual Federal budget in National Assembly on Friday (today).
Govt is likely to introduce measures to increase the country’s GDP growth, facilitating exports, agriculture and housing sectors and broadening the tax base of the country.
Special Cabinet meeting under the chair of Prime Minister Imran Khan would be held before the presentation of budget in National Assembly to approve the recommendations.
The Ministry of Finance would present different options to increase the salaries of the civil servants and pension.
An official informed that government would likely to increase pays by 10-15 per cent depending on the fiscal space available with the Ministry of Finance.
The government is setting higher benchmarks for rates of inflation, economic growth and fiscal and primary deficits for the next fiscal year. The GDP growth rate for next year is being targeted at 4.8 per cent against 3.94 per cent of the outgoing fiscal year.
Sectoral growth targets of 3.5 per cent for agriculture, 6.5 per cent for industrial sector, and 4.7 pc for services sector.
Meanwhile, inflation is anticipated to increase by 8.2 per cent.
Likewise, the overall budget deficit limit has now been pitched at 6.3 per cent of GDP while primary deficit would be around 0.6 per cent.
The current account deficit for next year is projected at $4.8 billion.
The gross revenue for next year has thus been projected at Rs 7.909 trillion.
The federal government would transfer Rs 3.422 trillion to the four provinces under National Finance Commission (NFC) award.
The net federal revenue is, projected at Rs 4.487 trillion next year.
The total current expenditure for next year is now projected at Rs 7.558 trillion.
The Federal Public Sector Development Programme (PSDP) for 2021-22 was approved at Rs 900b compared to Rs 650b allocation for the current year, showing an increase of 38.5 per cent.
The PSDP 2021-22 also included Rs 101 billion foreign funding in the shape of loans and grants.
The Ministry of Finance may allocate Rs 330 billion for power subsidies. Interest payment would be around Rs 3 trillion for the year 2021-22.
The government has already decided to fix tax collection target for Federal Board of Revenue (FBR) at Rs 5.8 trillion for the next fiscal year against projected Rs 4.7 trillion of the ongoing fiscal year. Meanwhile, non-tax revenue target is likely to be around Rs 1.4 to Rs 1.5 trillion.
The government would have to take additional revenue measures of around Rs 480 billion to Rs 500 billion to achieve the next year’s tax collection target of Rs 5800 billion.
The government has projected to collect Rs 4700 billion in current fiscal year.
Meanwhile, around Rs 620 billion would be generated through 5 per cent GDP growth and 8.2 per cent inflation rate in next financial year.
In revenue measures, the government is likely to withdraw tax exemptions and improving the administrative measures.
Three broader pillars on which the budget is premised include no new tax, expansion of tax base and documenting e-commerce under the tax net.
It has been proposed to document sales of 60,000 to 70,000 large retailers by bringing them under the point of sales.
The government is likely to cut down the Custom duties on raw materials in the upcoming budget to reduce the cost of doing business and increase the economic growth of the country.
The government is likely to eliminate Customs duty on 200 imported items while duties on other 100 items would be reduced from 3 per cent to 11 per cent.
The decision would help in reducing cost of business in textile, pharmaceutical, engineering, footwear and chemicals sectors.