The salaries of govt employees and pensioners gets 10% increase
Pakistan’s Finance Minister Ishaq Dar presented the budget for the upcoming fiscal year 2017-18. It was fifth and final budget of PMLN’s tenure, with the total outlay of Rs. 4.778 trillion.
According to the details, the federal government is allocating Rs. 15 billion for Interior Ministry while Rs920.2bn has been allocated for defence budget of the upcoming fiscal year and Rs. 1 billion is being set aside for Trade and Commerce Ministry.
Finance Minister Ishaq Dar in his in his opening remarks said that the government has set an ambitious GDP growth target at 6%. He added “This is the fifth budget being presented by the PML-N government, and this is an achievement for democracy”.
Dar said fiscal deficit brought down to 4.2 percent in the upcoming fiscal year. He also said power load shedding will end by next year. “Pakistan will be one of the top-20 economies in next 10-12 years.”
We have summed up all the major highlights of budgetary documents as follow:
CPEC and Gwadar projects
Rs180bn have been allocated for China Pakistan Economic Corridor (CPEC) projects while one project for Gwadar, including a new airport, 200-bed hospital and desalination plant is proposed.
Defence budget
A total of Rs920.2bn has been allocated for Defence of the upcoming fiscal year. All Army officers and jawans will receive a 10 percent special allowance other than the salary increment in lieu of their sacrifices in Pakistan’s war against militancy.
GDP growth rate target
The GDP growth in the ongoing year is 5.28. In budget 2017-18, the GDP growth rate has been fixed at six percent. While, economy volume crosses 300 billion dollars.
Subsidy on electricity
Rs118 billion allocated for subsidy on electricity. Subsidy would continue for those having consumption of 300 units monthly the most.
Agricultural loans
The volume of loans for agriculture would be equal to development loans. Moreover, the farmers having 12 acres land would get agricultural loans by 9.9 ratio per annum. GST and custom duty will be removed from agricultural machinery.
Govt employee’s salary
Finance minister announced 10 percent increase in government pensions and employees’ salaries. Dar also said that minimum wages in the country enhanced to 15,000.
Highways and Railways
Rs320bn will be allocated to national highways while Rs45.9bn to be allocated to Railways, including for 75 new engines, 830 bogies and 250 coaches and the Peshawar to Karachi railway line.
Energy
Ishaq Dar claims load-shedding will be history by next year as 401bn rupees will be allocated to energy projects including Dasu dam, Diamer Bhasha dam and Neelum Jhelum power plant.
Special projects
A total of 45.6bn have been reserved for jointly Azad Jammu & Kashmir, Gilgit Baltistan and Fata.
Pakistan Development Fund
Pakistan will raise $1 billion through a special convertible bond for overseas Pakistanis, says Dar.
New taxes
A new 5% withholding tax on tobacco production to be imposed, says Dar. “Sales tax on steel sector will be increased from 9% to 10.5%.”
Corporate tax
The rate of corporate tax has been reduced to 30% for 2017-18, says Dar. The rate was 35% in 2012-13 and has seen a yearly reduction of one percentage point.
Information and Technology
New IT companies will be a given a tax break of three years, says the finance minister.
“Withholding tax on mobile phone calls has been reduced from 14% to 12.5%. Sales tax on mobile phone calls has also been reduced from 18% to 17%,” says Dar.
In addition Rs20 billion are proposed to be allocated for the laptop scheme. While Rs121 billion are proposed for the Benazir Income Support Programme which would benefit over 6.8 million needy people.