The federal government has set a target of Rs9200 billion tax revenue in the budget for the next financial year, 3759 billion in the form of direct tax and the volume of indirect taxes is Rs5441 billion.
According to the documents, Rs3759 billion will be collected in the form of direct taxes and Rs5441 billion in indirect taxes, Rs3713 billion in income tax, Rs1178 billion in customs duty, Rs13.84 billion through worker welfare fund.
Rs817 million will be collected from capital value, Rs3578 billion in sales tax and Rs725 billion in federal excise duty.
The target of non-tax revenue is Estimated at Rs2963 billion, Rs398 billion from profits of government institutions, Rs1113 billion through SBP, more than Rs41 billion from defense services and Rs118 billion from government corporations.
A target has been set to raise Rs121 billion through shares of state-owned companies and Rs869 billion in petroleum levy.
According to the Finance Bill, it has been decided to increase sales tax on leather and textile products through point of sale, the sales tax rate on POS has been increased from 12 to 15 percent.
In addition to abolishing sales tax on cooking oil and edible oil, it has been decided not to increase the tax on import of all essential items, according to which duty on import paper of Quranic products, customs duty on raw materials of solar panel manufacturing, customs duty on raw materials manufacturing solar panel batteries, import of solar panel machinery and crude of solar panel inverter It has also been decided to abolish duty on goods.
It has been decided to abolish duty on import of raw materials of manufacturing diapers and extend tax exemption on import of machinery for erstwhile FATA, tax exemption for import of machinery in FATA will continue till June 30, 2024.
It has been decided to abolish the duty on the raw materials related to the manufacture of thinner and polyester manufacturing in the country, import machinery of the mineral sector and remove customs duty on dyes and other related raw materials of the textile sector.
National Debt
Finance Minister Ishaq Dar said in the budget speech that the total expenditure on interest payment this year will be Rs3,144 billion, out of which the external interest payment is estimated to be Rs373 billion, while next year the total payment is estimated to be Rs3,950 billion, out of which Rs3,439 billion will be spent on internal and Rs511 billion on foreign loans.
Ishaq Dar said that the country’s debt was Rs25,000 billion in 2017-18. In March 2022, it reached Rs44,365 billion, which is 72.5 percent of GDP. We have slowed down the pace of credit growth by reducing expenditure in the last two months of the financial year. According to the law, the government’s borrowing limit has been set at 60 percent of GDP.
FBR Taxes
The Foreign Minister said that the tax rate in emerging market countries is about 16 percent of GDP, but in Pakistan it is currently 8.6 percent. It is proposed to increase this rate to 9.2 percent during the next financial year. In 2017-18, we left the rate at 11.1 percent.
Trade Deficit
Ishaq Dar said that our government is taking important steps to increase exports and is trying to control the increasing trend of imports so that the balance can be done and the price of the dollar automatically goes on the right track. Imports, which are currently expected to reach $76 billion, will be brought down to $70 billion in the next fiscal year. Exports currently stand at $31.3 billion. Steps will be taken to increase them to $ 35 billion in the next financial year, these steps will reduce the current account balance from minus 4.1 percent of GDP to minus 2.2 percent of GDP in the next financial year.
Remittances
According to Finance Minister Ishaq Dar, remittances will be recorded at $31.1 billion in the current financial year. Remittances are expected to grow to $33.2 billion in the next financial year.
Taxes worth Rs200 billion imposed in upcoming budget: FBR Chairman
On the other hand, FBR Chairman Asim Ahmed while addressing a press conference in Islamabad said that additional taxes of Rs200 billion have been imposed in the upcoming budget, direct taxes of Rs175 billion have been imposed, indirect taxes of Rs25 billion have been imposed.
Chairman FBR said that withholding has been increased on the use of debit and credit cards in foreign countries, 10 percent withholding tax will be levied on non-filers of debit credit cards in foreign countries, 5 percent tax will be levied on filers.
He said that it is proposed to restore 0.6 percent withholding tax on non-filers on cash withdrawals from banks, while advance adjustment tax of Rs2 00,000 per annum is proposed to be imposed on foreign domestic workers.
