Cuts announced after Western countries announced new sanctions
Pakistan is confident of sustainable economic recovery in years ahead and pin high hopes on export-oriented industries, agriculture and housing sector to deliver strong results to help alleviate poverty from the country, say top government officials.
Addressing a joint post-budget press conference in Islamabad on Saturday, federal minister for finance Shaukat Tarin said the government has presented a growth-oriented budget that also includes relief measures to businessmen, investors, exporters, farmers and common man.
Federal Minister for Industries Khusro Bukhtiar, advisor to the Prime Minister on commerce Razak Dawood, special assistant to the Prime Minister on poverty alleviation and social protection Dr Sania and Federal Board of Revenue chairman Asim Ahmed were also present at the press conference and clarified various aspects of the budget.
Exports share in GDP
Tarin said the government is keen to promote exports and take their volume from eight per cent at present to 20 per cent of the Gross Domestic Product (GDP) in coming years. ”We have suggested various steps to promote exports that would help reduce pressure on the foreign exchange reserves, besides developing the local industrial sector,” he said.
The minister said the special economic zones being set up under the China-Pakistan Economic Corridor would also help in local industrial development and create job opportunities for the skilled and semi-skilled work force.
Agri sector development
Tarin said the government has proposed special initiatives for the development of agriculture sector and prosperity of farming community in the country.
“We accords special attention to small land holders up to 12.5 acres and will extend up to Rs450,000 interest-free loans to enhance agriculture production and alleviate poverty. We have also mobilised banking sector to extend credit facilities to growers at affordable rates,” he said.
“Every farming household would be provided Rs250,000 interest free loan for purchasing agriculture inputs. Another Rs200,000 will be provided to purchase tractor and other machinery to bring innovation and technological advancement in local agriculture sector,” he added.
The finance minister said development of marketing services, cold storage facilities and building strategic reserves of food commodities would also help curb the menace of hoardings, artificial shortage of food commodities and practice of extra profiteering.
Tarin, who presented PTI’s fourth budget on Friday, said the main focus of the growth-oriented budget is to empower the country’s poor segment so that they would not have to wait for trickle-down effect of economic progress.
“The government is directly targeting the poorest of the poor and facilitating them with different initiatives to upgrade their living standards. It would utilise the ‘bottom-up-approach’ for improving the living conditions of around six million low-income households,” the minister said.
Under the initiative, Tarin said every urban household would be provided Rs500,000 interest-free business loan. Likewise, every farming household would be given interest free loan of Rs150,000 for every crop, interest fee farming loan of Rs250,000 and interest free loan of Rs200,000 for buying tractor and agricultural implements.
“Low-interest loans of up to Rs2 million would be provided to help the people buy houses, besides Sehat Card to every household to facilitate them in time of need,” Tarin said.
Challenging revenue target
Tarin said the government had set a challenging target of revenue collection of over Rs5.8 trillion against Rs4.7 trillion for the current financial year.
“Annual revenue collection should be increased by 20 per cent if we need to create resources for development and achieve sustainable growth. However, we will not over burden the existing tax payers and instead has decided to expand scope of track and trace system to increase tax base,” the minister assured.
“We will be introducing incentives for consumers to achieve the realistically aggressive revenue target of Rs5.8 trillion. The Federal Board of Revenue (FBR) had also started data collection for identifying the potential tax payers, who were eligible to pay tax but were out of the tax net so far. It is expected to bring about 312,000 potential tax payers under the tax net,” he added.
“Some 10,000 Points of Sale were currently under use and their number would be enhanced by bringing 60,000 more business establishments under the system,” he added.
Tax reforms, ehsas programme
Khusro Bakhtiar highlighted the importance of maintaining the momentum in large-scale manufacturing growth while Razak Dawood said the government had adopted a two-pronged strategy to enhance exports and promote Pakistan-made products.
“The government was focussed on both traditional exports as well as innovative trade, including engineering, pharmaceuticals, information technology and food processing sectors,” Dawood said.
Sania Nishtar said the number of Ehsaas beneficiary families had been increased from seven million to 10 million, with six-month disbursement for each family raised from Rs12,000 to Rs13,000.
Asim Ahmed said reforms were being carried out at the FBR and it would emerge as a taxpayer-friendly entity in line with the vision of Prime Minister Imran Khan.
“Digital initiatives had been introduced to facilitate taxpayers at different stages, including return filing and refund claims,” he added.
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