PTI government to present Rs8,400b ‘growth-oriented’ Budget 2021-22
Salaried people likely to get tax relief
Information Minister Fawad Chaudhary said on Friday that salaried people would get a relief in taxes in the Budget 2021-22.
He said this on SAMAA TV’s morning show NayaDin ahead of the Rs8,400 billion federal budget, which the government will present in the National Assembly later today.
The government officials are saying this budget will be “growth-oriented” and incentives will be given to agriculture, industry and IT sectors.
After contracting 0.4% last year, the economy recovered and is expected to grow at 3.9% this year, nearly double the government’s own target of 2.1%. For the next year, it is targeting a growth rate of 4.8%.
Finance Minister Shaukat Tarin said earlier this week that they would use the bottom-up approach, which would include marginalized and lower-income segments. They would be given business loans, health cards and technical training, he added.
The government has not released official data for unemployment, but Tarin said about 20 million people lost work last year as the coronavirus pandemic compelled the government to shut the economy for three months. Even now 2.5 million people are out of work, according to Tarin.
Other reports suggest an additional 20 million have slipped below the subsistence level, thanks in part to inflation that remained in high single digits throughout the year, higher than the annual target of 6.5, and was recorded in the double digit in the last two months.
The government has decided to increase the size of the Public Sector Development Programme by 38%, according to the finance minister. It will spend Rs900 billion on the PSDP in the next fiscal year.
The government has set a tax collection target of Rs5,829 billion for the next fiscal year, but it remains unclear where this money will come from.
News reports suggest the International Monetary Fund wants it to impose new tax measures, but the government is reluctant. Its top ministers are saying they will neither introduce new taxes nor increase the current ones, and rather go for expanding the tax net, which means the government will go after tax evaders with a focus on retail sector.
Tarin said they would take additional revenue by selling some of the government-owned enterprises, which are not making any profits.
