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Pakistan targets growth, stability

Addressing a post-budget Press conference on Saturday, he said the budget focused on maintaing economic stability and growth as well as reducing the inflation rate to a single digit. Also a primary objective was to collect taxes from those higher income individuals who evaded paying it.

He counted relief provided to genuine tax payers including raising the income tax limit to Rs400,000, a 20 per cent increment in base salaries and pensions, customs duties reduction on pharmaceutical raw materials and stationery items and fund allocation for creating 100,000 jobs for graduates.

Taxation measures included setting a bar of 16 per cent sales tax on all products higher than this percentage while maintaining sales tax rates on all products below it. He said the government wished to remove the burden of taxes from the common man. “We want only two taxes to exist in Pakistan: income tax and sales tax,” he said.

He said turnover tax on income of businesses was slashed by 50 per cent, a move that will increase liquidity and cash flow. Solar tubewells would be introduced in the country while providing subsidies. “The percentage of the subsidies will be set in a few days,” Shaikh said adding that this measure would help Pakistan become “less dependent” on oil imports that were required for generating electricity.

The finance minister also announced that the scrutiny and criticism that the government faced due to its expenditures was being answered in this budget starting with converting the Prime Minister House into an “international institute for advanced studies”.

“Taking this spirit forward, all governmental expenditures will be reduced,” he said.

He said that Pakistan was becoming self-sufficient. “The country which used to import wheat and sugar is now capable of exporting the commodities to other countries,” he said.

Responding to questions on continuing power riots and violent protests across the country that rocked many more cities on Saturday as well, the minister said that the shortfall could not be dealt with just by allocating finances, but the government did whatever it could through the budget by allocating Rs183 billion directly and some more through the developmental programme and other allocations.

“The problem will be solved when issues in the administrative infrastructure and governance are resolved. Developmental programmes for generating electricity are being initiated,” he said.

“Expenditure for generating electricity is more and electricity charges are less. The federal government has financed this gap of billions of rupees till now.”

On dubious inflation rates given in the budget, the minister said that all figures used by the government were set by the statistical department. “They are accepted by all,” he said. “You should trust these figures.”

business@khaleejtimes.com