KARACHI Sindh Chief Minister Syed Qaim Ali Shah on Friday presented Rs422 billion Sindh budget for 2010-11, showing a deficit of Rs25 billion. The budget shows total revenue of Rs397 billion, with a deficit of Rs25 billion, which is six per cent of the total budget. The provinces Annual Development Programme has been set at record Rs115 billion against the current years allocation of Rs75 billion with an increase of 53 per cent. Delivering the budget speech in Sindh Assembly, CM Qaim Ali Shah described the budget a tax-free in essence. His speech was frequently punctuated with thumping of desks. The estimated revenue receipts from divisible pool under the new NFC Award are Rs207.3 billion with 78.2 per cent increase over 2009-10 budget. This, however, includes the receipt relating to Octroi and Zila tax. The estimates under oil and gas receipts are Rs51.2 billion against revised estimates of Rs53.7 billion. Provincial own receipts have been pitched at Rs50.5 billon with an increase of 27 percent over the revised estimates of outgoing year. The government in addition a provision of Rs25 billion for the sales tax on services, which will begin to collect soon. The aim will be to target collection of Rs40 billion, however, the government made slightly conservative estimates in budget this is the first year, Shah said. On the expenditure side, the Chief Minister said the current revenue expenditure has been estimated at Rs268.3 billion with an increase of 19.3 per cent over the revised estimates of Rs224.8 billion. The shares of local governments have been worked out to be Rs120.8 (including Rs33.2 billion of District Support Grant) on the basis of the 2007 PFC Award and it reflects an increase of 20 percent over budget 2009-10. Referring to the Development Budget for 2010-11, Qaim Ali Shah said that the government has been increasing the Provincial ADP to Rs115 billion against the current years allocation of Rs75 billion an increase of 53 per cent. The District Development portfolio has been at Rs18 billion. Shah said that the deficit shall be finance through improving the revenue collection, mobilising additional resources, containing current expenditure through ban on wasteful expenditures especially vehicles and discouraging unnecessary foreign visits etc. We also expect to resolve the issue of SCARP CDLs. Here we have paid an amount of Rs22 billion to the government of Pakistan and we plan to take the issue with federal government again, he added. Referring to increase in the pay of government employees, he said in line with the federal governments announcement, the Sindh government proposed to increase the pay of the provincial government employees. Ad hoc relief of 50 per cent of basic pay, 100 percent increase in the medical allowance of employees in Grade 1 to 15 and 15 per cent of initial basic pay as medical allowance for employees in BPS 16 to 22. These increases are estimated to cost an additional amount of Rs31 billion to the provincial exchequer. Award of time scale and qualification allowance to the teachers, he said government of Sindh has accepted the longstanding demand of the teachers for a time scale to the teachers along with the qualification allowance. This would cost the government an amount of Rs1.8 billion. About fiscal measures, he said Sindh government is proposing fiscal measures for enhancing revenue receipt to boost investment and to provide relief to certain section of society. Capital Value Tax, he said after 18th amendment in the Constitution, the levy of Capital Value Tax (CVT) on immovable property falls under the provincial domain. The federal government was collecting this tax at the rate of 4 percent. The Sindh government proposes to levy this tax at rate of two percent for residential and 2.5 percent for commercial immovable property which would reduce the burden on people of Sindh by 37.5 percent and 50 percent respectively. Rationalising of stamp duty and registration fee, the government is proposing to reduce the rates of stamp duty on conveyance deed to 2 percent from the existing 3 percent with a view to expand the net and facilitate greater documentation. In this regard, the valuation table of the immovable properties would be increased in accordance with prevalent inflation. Stamp duty is being reduced in favour of Real Estate Investment Trusts (REITs) and the end users so as to facilitate resource mobilization and investment through the vehicles of REIT in the formal sector. This will help in fast track development of real estate and housing sector, he added.