Pakistan Budget 2017-18: Total budget outlay is Rs 4.7 Trillion

Pakistan Budget 2017-18 Live | pakistantribe.com

ISLAMABAD – The Financia Minister Ishaq Dar has presented Pakistan’s budget for 2017-18 today here in Islamabad. 

It is for the first time that a fifth consecutive budget is being presented by the same Prime Minister and Finance Minister.

PakistanTribe.com business desk updated you about the budget detail direct from the National Assembly of Pakistan.

According to PakistanTribe’s correspondent from Islamabad, total budget amount is Rs.4778billion while development budget allocation si Rs.1001billion.

“Today Pakistan is on the cusp of a high growth trajectory. Our GDP has grown this year by 5.3% which is a 10-year high. Foreign exchange reserves are at a comfortable level, sufficient to cover about 4 months of imports; tax evenues have increased by 81% over the last four years translating into an average annual increase of 20%; since 2013 credit to private sector has increased by over five times; fiscal deficit will be around 4.2 percent; there has been over 40% increase in imports of capital goods this year; gas availability has improved, and load-shedding for industry has been eliminated and substantially reduced for commercial and domestic sectors – Inshallah next year will be the year of complete elimination of load shedding, said IShaq Dar during his budget speech.”

Read More: Budget 2017-18: Where we were 4 years’ ago and where we are today?

Total budget outlay is Rs 4.7 Trillion

Economic targets of FY 2017-18:
(1) Increase in real GDP growth of 6%;
(2) Investment to GDP 17%;
(3) Development budget of Rs.1,001 billion
(4) Inflation below 6%;
(5) Budget deficit at 4.1% of GDP;
(6) Tax to GDP ratio at 13.7%;
(7) Foreign exchange reserves level that can cover a minimum of 4 months of imports;
(8) Net public debt to GDP ratio below 60% of GDP;
(9) Continuation of targeted social interventions.

In order to achieve the above targets, government has defined a strategy which includes the following details:

(1) FBR revenues are targeted to increase by 14% while the Federal expenditures will grow by 11%;
(2) Non-tax receipts of the Federal government are budgeted to increase by 7%.
(3) By keeping the current expenditure under tight control, we will be able to create substantial space for development. Federal PSDP for the next year is budgeted at Rs.1,001 billion. This is 40% higher than revised estimates of Rs.715 billion for the current financial year we add the provincial ADPs the outlay for development of FY 2017-18 would be a whopping Rs.2.1 trillion;
(4) At the same time, current expenditure will be contained below the level of inflation;
(5) New initiatives are being announced for agriculture, financial sector, exports, textile, social sector and employment. This is being done with the aim to boost our economic activity even further. The purpose is to increase job prospects and incomes of the people. I will present these initiatives in a short-while;
(6) Tax incentives are being announced with the aim to give facilitation to the agriculture, SMEs, and IT sectors;
(7) Under the leadership and personal supervision of Prime Minister Nawaz Sharif through Cabinet Committee on Energy, approximately 10,000 MW of electricity will be added to the national grid by summer 2018. This will Inshallah eliminate load shedding;
(8) Investments will be made to speed up the process of development of Gwadar including development of airport, hospital and desalination plant;
(9) Around 5.5 million women-led families in the country who do not have economic means for sustenance will continued to be provided with cash transfer of Rs.19,338 per annum. For this purpose, Rs.121 billion are proposed to be allocated to Benazir Income Support Programme. This allocation has increased to 300% of Rs.40 billion in fiscal year 2012-13. During this period, the number of recipient families have increased from 3.7 million families in 2013 to around 5.5 million. In addition, around 1.3 million primary school children are receiving cash grants;
(10) The state will continue to subsidise bills of the low-income domestic consumers up to 300 units per month in shape of electricity subsidy. For the farmers in Balochistan, the Federal Government will pay a portion of their electricity bills to run agriculture tube wells. The Federal Government’s will continue to provide electricity subsidies on tube-wells in Balochistan. Off-peak rate of Rs.5.35 per unit for agriculture tube-wells will continue in the FY 2017-18. An amount of Rs.118 billion has been proposed in the FY 2017-18 for these measures;
(11) The Prime Minister’s youth schemes which include business loan scheme, interest free loan scheme, training scheme, skill development programme, fee reimbursement, and laptop programme will continue. For this purpose Rs.20 billion is proposed in the fiscal year 2017-18.

Low income groups will be provided loans through micro finance institutions. Rs. 8 Billion provided to establish fund at State Bank of Pakistan.

10 percent increase in pensions of government employees

Minimum wages have been increased from the existing 14000 to fifteen thousand per month.

Custom duty and sales tax on agricultural machinery have been withdrawn

43% increase in commercial lonas for farmers. Rs. 700 bn agriculture loans were discriminated this fiscal year

Economy has reached a mark of 300bn USD – highest in Pakistan history. Foreign Exchange Reserves surged over $21bn

Pakistan Infrstructure Bank to be established for infrstructure projects

Withholding tax to be relaxed on Branchless banking

E-Gateway systems to be established at cost of Rs. 2 Billion

Risk sharing scheme to be initiated for housing sector. Rs. 6 Billion allocated for housing sector

We are going to start ‘Clean Drinking Water For All’ programme with the cost of Rs. 12.5 Billion

Rs. 180 Billion allocated for CPEC and allied projects

Rs. 62 Billion allocated for special zones including AJK and GB. 6.9 Billion allocated for FATA.

Beside increase in basic salary 10% special allowance to be awarded to Pakistan Armed Forces.

Rs. 920 Billion allocated for Defence expenditure

Budget deficit will be reduced to 4.2% of GDP

Withholgin tax on Mobile calls to be reduced to 12.5% from 14%

Rs. 12.5 Billion allocated for ‘Energy For All’ project

Rs. 401 Billion allocated for power sector

Disaster Risk Management Fund to be established with Rs. 12.5 Billion

Long term financing facility on textile reduced to 5%

Brand development fund to initiated

Loans of widows lower than Rs. 500,000 to be paid by government

CDA will announce separate sectors to encourage investors

10% Ad Hoc relief announced for government employees

Know More: More than Rs. 1 trillion development budget is unprecedented in the history of Pakistan, PM

Taxation in Budget 2017-18

Same tax ratio for Islamic Banking products

Rs. 3,000, 5,000 and 10,000 reduced on 800, 1,000 and 1,300 CC vehicles 

No change for non filers in withholding tax 

WH Tax to be reduced on daily consumer goods

One year extension in super tax

Dividend rates to be increased to 15% from 12%

I.T soft park to be extablished with cost of Rs. 6 Billion with help of South Korea

New I.T companies to be exumpted from income tax for three years

No sale tax on I.T services in Islamabad and other federal administrated areas

No cancelation of license for Non-Profit Organisation (NPO) if failed to spend 75% of their earning on social work. 10% tax charged on the surplus revenue. NOPs must reduce administrative expenses to 15%

Dividend form Mutual Funds increased from 10% to 12%

Tax ration increased on dividends from 12.5% to 15%

Tax on Machinery of poultry business to be reduced to 7%

Multi-media projectors tax to be reduces

6% sales tax imposed on import of commercial clothing

FED imposed on Cigerates

Sales Tax reduced on Mutlimedia Projectors

Excise duty on Cement sector to be increased per KG

30% tax decreased for coproate sector

Sales Tax on steel sector electricity increased from Rs. 9 to Rs. 10.5

Sales Tax rebate on premixes to discourages stunting

Sales Tax on Poultry machinery reduced from 17% to 7%

Capital Gain Tax to be fixed11% custom duty to be charged for local manufacturers of baby diapers

Salient Features of Public Sector Development Programme 2017-18

  • Total Rs. 2.1 trillion allocated for PSDP in Pakistan Budget 2017-18
  • Infrastructure sector allocated 67% of total development budget
  • Government to get Rs. 163 Billion foreign assistance
  • Rs. 1.1 Trillion provided to the provinces
  • Rs. 4.3 Billion for aviation division
  • Cabinet division Rs. 159 million
  • Rs. 5.1888 Billion Allocated for CADD
  • Rs. 1.2 Billion For commerce division
  • Rs. 13.6 Billion For Communication division
  • Rs. 4.4 Billion Allocated for Defence Production
  • Rs. 815 for climate change division in PSDP
  • Rs. 1200 for commerce
  • Rs. 13660 for communication division
  • Rs. 535million set aside for defence division
  • Establishment division to get 270m in PSDP
  • Rs. 26961 earmarked for federal education and professional training division
  • Rs. 35662 million for HEC in PSDP
  • Human Rights division to get Rs. 306 million
  • Rs. 811 million allocated for information and broadcasting division
  • Rs. 2737 for Industries and Production division
  • Rs. 1538 million for I.T and Telecom division
  • Rs. 3044 million for inter provincial coordination division
  • Interior Division to get Rs. 15666 million
  • Kashmir Affairs, GB division to get 43684 million
  • Rs. 183 million for narcotics division
  • Law and Justice Rs. 1200 million
  • National food security to get 1614 million
  • National History and Heritage division to get Rs. 211 million
  • PNRA Rs. 321 million
  • Rs. 790 million for Revenue Division
  • National security division to get 100 million
  • Peace 15085 million in PSDP
  • Planning division to get 16798 million
  • Post shipping 127775 million
  • 42900 earmarked for Railway division
  • SAFRON division 26900 million
  • SUPARCO Rs. 3500 million
  • Textile and Industry division Rs. 217 million
  • NHA to get Rs. 319720 Million
  • Rs. 60909 million allocated for WAPDA
  • Rs. 45000 provided for IDPS
  • ERRA 7500 million
  • Rs. 25 billion for security enhancement of IDPS
  • 20 billion for PM Youth programme

 

Earlier Prime Minister Nawaz Sharif said on Friday that “we are working to introduce governance reforms, which is a long process with opposition from various segments.”

PM Nawaz said while addressing the ruling party’s lawmakers in Islamabad only people will decide “who is working hard and who did not work at all”.

Referring to the allocations for the next financial year in the upcoming budget of 2017-18, PM Nawaz said: “The development budget of Rs1 trillion is unprecedented in the history of Pakistan.”

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