Highlights of Pakistan budget 21-22

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  • The total size of the budget for the next year is Rs8487 billion which is 19 per cent higher than last year’s budgeted expenditure of Rs7136 billion.
  • GDP growth target is set at 4.8 per cent.
  • 10 percent ad-hoc relief allowance in the salaries and pensions of federal government employees.
  •  increase in the orderly allowance from current Rs 14000 to Rs 17500 per month besides raising integrated allowance for the employees of grade 1 to 5 from Rs 450 to Rs 900.
  •  the government has increased the minimum wage for workers to Rs 20,000 per month.
  • Withholding tax rate for mobile services reduced from 12 per cent to 10 per cent.
  • Locally manufactured cars having an engine capacity of 850cc or less will be exempted from value-added tax (VAT) while the sales tax on these cars will also be reduced from 17pc to 12.5pc.
  • Four wheelers are also exempted from federal excise duty.
  • The federal excise duty on mobile phone calls that are longer than three minutes has been set at Rs1 per call, Rs0.1 on every SMS and Rs5 on every GB of internet data.
  • The federal excise duty on telecommunication will be reduced by 1pc from 17pc applicable previously.
  • Withholding tax on telecommunication services will also be reduced to 3pc.
  • federal excise duty on fruit juices will be withdrawn.
  • withholding tax on cash withdrawals and on non-cash banking transactions will be removed.
  • withholding tax on domestic air travel will be ended

Associated Press of Pakistan

 The Pakistan Tehreek-i-Insaf led government Friday unveiled Rs 8.4 trillion pro-people and business-friendly federal budget for the fiscal year 2021-22, with major focus on pursuing all-inclusive, sustained and robust economic growth through comprehensive planning and development.

Despite the severity of 3rd wave of COVID-19 pandemic, the incumbent government in its third budget made remarkable allocations to carry out massive development projects and welfare activities for the downtrodden segments of society, besides promoting the agriculture sector to ensure food security and reduce dependence on imports.

Presenting the budgetary proposals in the National Assembly, Minister for Finance and Revenue Shaukat Tarin said the government steered the economy out of crisis and put it on the growth trajectory by pursuing prudent policies under the dynamic leadership of Prime Minister Imran Khan.

He said the country was now out of dangerous situation as the government took initiatives for its economic sustainability as evident from 3.94 percent Gross Domestic Product (GDP) growth rate during the current fiscal year.

The minister said it was for the first time that any government had to face a critical situation and it successfully put the economy on sustainable growth path.

He said the Current Account was now $800 million in surplus, as compared to deficit of $20 billion at the end of last government.

He said the previous governments had also manipulated exchange rate, which had adversely affected the economy, resulting into depletion of foreign reserves to $10 billion.

However, they increased the reserves by taking loans, which were now being repaid by the incumbent government, he added.

Tarin said the government had successfully fulfilled all the international commitments, besides putting the economy on growth trajectory. For the purpose, it had to take tough decisions, such as reducing public expenditures and enhancing revenues, he added.

He said during the current year, the agriculture sector did perform well despite locusts attacks and all the major crops, except cotton, witnessed positive growth.

Likewise, the services and the large scale manufacturing sectors also had considerable growth despite COVID-19 factor, he added.

The minister said one of the top priorities of incumbent government was to uplift the downtrodden segments, and for the purpose 40% of the total population was given cash transfers, besides providing relief to 15 million households across the country.

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