News
Thursday, June 13, 2013
Rates of taxes increased; no decision on pay raise for govt employees; secret funds abolishedBudget tough on masses
* Total outlay for Federal Budget 2013-14 stands at Rs 3.59 trillion with fiscal deficit of 8%
* GDP growth rate projected at 4.8%; inflation 9.5%; revenue target set at Rs 2.475tr
* GST raised from 16 to 17 percent
* Pension up by 10%; minimum pension raised from Rs 3,000 to Rs 5,000
By Sajid Chaudhry
ISLAMABAD: The government on Wednesday presented in the National Assembly the federal budget for the fiscal year 2013-14 with an outlay of Rs 3.591 trillion and deficit of 8%.
After transfer of Rs 1.502 trillion to provinces under the NFC Award, federal government would be left with Rs 1.918 trillion in net revenues and Rs 1.651 trillion budget deficit, which will be financed through external, bank and non-bank borrowing. Despite announcement of relief measures, taxation, especially increase in GST rate from 16% to 17% in the federal budget, would have direct impact on consumers and would fuel inflation in the country. The GDP growth rate has been projected at 4.8%; inflation 9.5% and revenue target set at Rs 2.475 trillion.
The budgetary and taxation measures would help remove distortions in the economy as well as in the taxation system for revival of economy and generation of additional resources for national development. The budgetary measures would mainly benefit the traders and industrialists, and to some extent the youth and pensioners. However, there has been no major relief for the general public except the Rs 2 billion Ramazan Package.
The Benazir Income Support Programme has been renamed as National Income Support Programme and Rs 71 billion has been allocated for this initiative. To generate additional resources for the poor, government has announced a levy of 0.5% tax on moveable assets of the rich. In this regard, Income Support Levy Act would be legislated by parliament. Against expectations, the government announced no increase in salaries of the government employees, however, a 10% increase has been made in the pension of retired government servants. The minimum pension for the retired government servants has been raised to Rs 5000 per month.
The government has announced an allocation of Rs 2 billion to subsides prices of essential food items at Utility Stores Corporation outlets during the upcoming holy month of Ramazan. There would be complete ban on purchase on new cars with exception of operational vehicles of law enforcing agencies and critical development projects. Peoples Works Programme II based on discretionary funds of the prime minister has been abolished, however, Peoples Works Programme I has been renamed as Tameer-e-Watan Programme and it will be continued.
Courtesy www.dailytimes.com.pk