On Friday, Finance Minister Shaukat Tarin presented the budget 2021-22. He announced the total size of the budget or the total expenditure budget for the next year stood at Rs. 8.487 trillion — around 19 percent higher than last year’s estimated expenditure of Rs. 7.136 trillion.
The finance minister announced that for FY22, the government had set a GDP growth target at 4.8%. The total allocations for the Public Sector Development Program (PSDP) have been budgeted at Rs. 2,135 billion for FY22, up from Rs. 1,324 billion last year.
Major budget highlights concerning the Business, IT, Telecom, and Automobile industry:
- Sales tax on electric vehicles has been decreased from 17% to 1%.
- The government will slash withholding taxes on mobile phones. The taxes were decreased to 10 percent initially and then to 8 percent.
- Decrease of block taxation on capital gain on settlement of fixed assets if the gain exceeds Rs20 million.
- Around Rs12 billion set aside to support small and medium businesses while another Rs10 billion was set aside for the Kamyab Jawan program.
- An amount of Rs8.11 billion has been marked for science and technology.
- 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.
Furthermore, the Finance Minister is also expected to declare incentives to the IT sector and export-oriented enterprises as he stated Pakistan will focus more on value-added exports.
The Minister further praised the leadership of Imran Khan stating, “Many challenges came our way this year but we tackled them all under the leadership of PM Imran Khan,” said Tarin. When the PTI came into power, the former governments had taken numerous loans. No government had encountered such a situation before.
Meantime, it is pertinent to consider that Pakistani authorities are currently in discussions with the IMF for the finalization of the suggested budgetary measures. There remains a possibility that some of the above actions do not appear in the final announcement.
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