Press Release on the Federal Budget 2017-2018 - Pakistan Justice and Democratic Party

Pakistan Justice and Democratic Party

Press Release on the Federal Budget 2017-2018

27-5-2017: Government budget directly affect socio-economic living conditions of the people. The Federal government has unfolded its fifth ad hoc budget, with window dressing of various sectors without setting any direction for viable development. On one hand , the Finance Minister admitted the shortage of more than 1.0 million houses with a further shortage of 300,000 houses annually; on the other hand 25% increase in FED on cement and increase of 16.7% sales tax on steel items will further aggravate this shortage. It will slow down growth in the construction which was already low at 9.1% in 2016-17 as compared to 14.6% in 2015-16. Obviously collection targets are the name of the game.
No structural fiscal reforms or legislative reforms have been accomplished during the past decade. Resultantly, the fiscal system has degenerated into too oppressive and un-wieldy taxation system to allow economic development and fairplay. Debt driven GDP growth with extensive error margin is being presented as an historic achievement but productivity , exports , investments and remittances are shrinking with is ominous. Following are some of the examples of adhoc measures without any long term vision:
* As regards loans to farmers upto Rs. 50,000 , shown as big favour, is no favour at all because the mark up of 9.9% is higher that the rate at which some goods banks are giving loans to individuals [ Habib Metro 7.77, SME 9.62%; ABL 9.62%; Bank al-Habib 9.72%]
* 25% increase in the rate of minimum tax on businesses which are in losses or which have very low income, is highly deplorable.
* Introduction of Sales Tax on imports meant for FATA without socio-political reforms and economic development is not only unjustified but also against the judgments of the superior Courts , including the Peshawar High Court in the case of Taj Packages Co. (Pvt.) Ltd. Vs Government of Pakistan 2016 PTD 203.
* Out of Rs. 1.001 trillion, the government has set aside Rs. 272 billion – 27% of the proposed federal development budget–for special programmes, Prime Minister and parliamentarians’ pet schemes. It is against the Hon’ble Supreme Court judgement in the case of Raja Pervaiz Ashraf’s Case reported as 2014 PLD SC 131
* In ease of doing business, except from getting loan and property registration , all other business related actions have become more difficult as
compared to the last year.
* Government says its loan is about 60% of the GDP. Further budget deficit of 4.1% means the government will have to take more loans and will have to pay profit on that resulting in more taxes. Public debt servicing is Rs. 1410 billion which is 45% of the total revenues.
* Exports have reduced by 7.8% as compared to the last year. It means our industries are not competitive as compared to other countries.
* Income Tax on 140 Million telephone subscribers is unlawfully and illegally being collected specially when according to the government itself, only 3.2 Million people should pay taxes. At present the number of filers is around 1.2 million.
The real issue has been ignored. In Human Development Index (HDI) which shows real welfare activities of a nation, Pakistan stands at No. 147 in a list of 188 countries.

Mian Ashiq Hussain ------- President (Punjab) Pakistan Justice and Democratic Party
Muhammad Arshad ……. Vice President (Pakistan) Pakistan Justice and Democratic Party

Budget deficit = Difference between total receipts and total expenditure -----------4.1%
Fiscal deficit =

1001 billion loans to the farmers
Public Sector Development Projects enhanced from 715 billion rupees to 1,001 billion rupees for 2017-18,

Posted on May 28, 17 | 3:23 am