Finance Minister presents Budget 2018-19 amid opposition’s protest

Rs 9.5 bn allocated for NPGP in next fiscal year: Miftah Ismail

ISLAMABAD: Finance Minister Miftah Ismail presented federal budget for fiscal year 2018-19 with total outlay of 5246 billion rupees amid opposition protest in the National Assembly and walkout of the session.
Earlier, opposition political parties including PPP and PTI staged walkout of the session against Miftah Ismail for presenting budget. PTI lawmakers besieged the Finance Minister while presenting budget and tore apart budget copies.
Meanwhile, Minister for Finance Miftah Ismail presented budgetary proposals at the National Assembly.
He said that the federal gross revenue receipts are estimated at 5661 billion rupees as compared to 4992 billion rupees in the outgoing year.
This includes FBR’s tax estimates of 4435 billion rupees as against revised estimates of 3935 billion rupees for the current financial year.
Out of the total revenues, the provincial governments’ share is estimated to 2590 billion rupees as compared to 2316 billion rupees revised estimates for the current financial year.
After transfer to the provincial governments, the net revenue of the federal government is estimated at 3070 billion rupees for the next year as compared to revised estimates of 2676 billion rupees in the current financial year.
The interest payments for next year have been budgeted at 1620 billion rupees against the revised target of 1526 billion rupees for the outgoing year.
The defense budget is proposed at 1100 billion rupees against the revised budget of 999 billion rupees in the outgoing year.
Budget deficit will be four point nine percent of the GDP as opposed to five point five percent of GDP of revised budget estimates in the outgoing year.
The Finance Minister announced ten percent adhoc relief allowance to the civil and armed forces employees and ten percent increase in pensions across the board.
House rent ceiling and house rent allowance have also been increased by fifty percent each.
Minimuum pension is being increased from the existing six thousand to ten thousand rupees considering the difficulties of low paid pensioners.
Similarly, family pension would also get increase from 4500 rupees to 7500 rupees.
Minimum pension of pensioners above seventy five years of age would be fifteen thousand rupees.
The government has also proposed an allocation of twelve billion rupees for provision of advances to government servants for house building and purchase of transport facility.
It has also set aside five billion rupees for senior officers’ performance allowance, details of which would be announced separately.
Over time allowance of staff car drivers and dispatch riders is being increased from forty rupee per hour to eighty rupee per hour.
The finance minister said the financial impact of these proposals will be sixty nine billion rupees.
Miftah Ismail said despite many difficulties and challenges, the government achieved economic stability over the last five years and took the growth rate to the record level.
Highlighting the economic performance of incumbent government, the Finance Minister said GDP ratio remained five point eight percent during the current fiscal year which is the highest in the last thirteen years.
He said volume of economy over the last five years has increased to thirty four thousand, three hundred and ninety six billion rupees.
Finance Minister said per capita income has increased to over one hundred and eighty thousand rupees. Today, the country has become the twenty fourth biggest economy.
He said the agriculture sector grew by three point eight percent, industrial sector by five point eight percent, services six point four percent during the current fiscal year.
Miftah Ismail said government also controlled the inflation rate to three point eight percent. The food inflation remained two percent.
Finance Minister said budgetary allocations for Benazir Income Support Program for the next financial year have been increased to 124.7 billion rupees as against 121 billion rupees in the outgoing year.
The Minister said government has launched a national poverty graduation program for BISP beneficiaries with more than nine point five billion rupees.
Under this program beneficiaries willing to start their own businesses will be provided with a one-time cash grant of fifty thousand rupees to start their own business.
Miftah Ismail said that 688 million rupees are being allocated for Pakistan Poverty Alleviation Fund.
He said the scheme launched by PML (N) government in 1991 to pay the loans of widow borrowers from house building finance corporation up to the value of 3.5 lac rupees would continue next year with an increased limit of six hundred thousand rupees.
Miftah Ismail also announced several relief measures for agriculture, daily and poultry sectors.
These include withdrawal of three percent custom duty on import of bulls meant for breeding purposes.
Concessionary rate of customs duty on the import of feeds meant for livestock sector is being reduced from ten percent to five percent and fans meant for use in dairy farms be allowed a concessionary rate of three percent to members of corporate dairy association.
This will substantially reduce their cost of inputs and boost further expansion in respect of poultry sector.
The government announced that the rate of customs duty of eleven percent on corrective eyesight glasses would be reduced to three percent.
The Finance Minister announced that enabling provisions are proposed to be incorporated in the income tax ordinance to implement property transactions.
Under the proposals, property transactions will be recorded on the value declared by the buyer and the seller and FBR notified rates are proposed to be abolished.
At the federal level, one percent adjustable advance tax from the purchaser on the declared value is proposed to replace the existing withholding tax on sellers and purchasers.
It is proposed that the non-filers may not be permitted to purchase property having declared value exceeding four million rupees.
The provinces have been asked to abolish the provincial rates for the collection of stamp duty and to collect a total of one percent tax under stamp duty and capital value tax on the value declared by the buyer and the seller.
To discourage under declaration, the FBR may hold a right to purchase any property within six months of registration by paying a certain amount over and above the declared value which may be hundred percent in the next fiscal year, seventy five percent in the following year and fifty percent in the subsequent year.
The Finance Minister said due to enhancement of taxable limit of income to one point two billion rupees, the number of filers will be substantially reduced leading to loss of revenue.
He said a nominal income tax of one thousand rupees would be imposed for income between four hundred thousand to eight hundred thousand, and two hundred thousand rupees for income between eight hundred thousand to one point two million rupees.
Miftah Ismail said the super tax imposed in 2015 for rehabilitation of internally displaced persons would continue but its rate may be reduced by one percent per year from the next financial year for both banking and non-banking companies.
Finance Minister said the government has decided to reduce corporate tax rates from thirty percent in tax year 2018 to twenty five percent in tax year 2023.
The corporate tax rate would be twenty nine percent in tax year 2019 and will be reduced by one percent each year up to tax year 2023.
Tax rate on undistributed profits would be reduced from seven point five percent to five percent and the condition of distributing forty percent after tax profit may be reduced to twenty percent.
Presently, zero point six percent tax is charged on non-cash banking transactions from non-filers which is being reduced to zero point four percent on a permanent basis.
The Finance Minister said in order to increase the cost of doing business higher for non-filers higher rates of tax withholding for non-compliant tax payers have been proposed.
Prior to Miftah’s presentation, Prime Minister Shahid Khan Abbasi has said that PML-N government considers its responsibility to present budget to run the affairs of the government.
He was responding to points raised by Leader of the Opposition in National Assembly Khurshid Shah and PTI leader Shah Mehmood Qureshi in the lower house of parliament this afternoon.
He said the next government has the complete authority and right to make changes in the budget.
He said Miftah Ismail will present the budget and it is the decision of cabinet and there is nothing unlawful in it. He said right of presenting the budget belongs to that person who prepares and makes budget with hard work and dedication.
The Prime Minister said Rana Muhammad Afzal, as Minister of State for Finance, assisted Miftah Ismail in the preparation of budget. He said the budget presents unprecedented relief to the people of Pakistan.
Shahid Khaqan Abbasi says the government is going to provide great relief to the masses in the budget for next fiscal year.
He said that it was cabinet decision that Miftah Ismail will present the budget and there is nothing wrong in this.
Opposition leader in the National Assembly Syed Khursheed Ahmed, on a point of order, criticized the government for forwarding a non-elected person to present the federal budget. He said that the Prime Minister could have presented this budget or asked State Minister for Finance Rana Muhammad Afzal, who is an elected person of this house to present the budget.
He said that the government is going to complete its tenure and presenting federal budget for the whole year should be left for the next government.
Talking floor, PTI Leader Shah Mehmood Qureshi also voiced that Rana Muhammad Afzal should present the budget.
Later, the opposition walked out of the House.


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