Complete text of Finance Supplementary (Amendment) Bill 2018

ISLAMABAD: Minister for Finance, Revenue and Economic Affairs Asad Umar on Tuesday said that the Finance Supplementary (Amendment) Bill 2018 included several measures for providing relief to the poor including allocation of Rs 4.5 billion for construction of 8276 houses, 30 percent cut in prices of LNG and reduction in tax slab from 35 percent to 29 percent.

He said that the previous government presented an unrealistic budget by overstating expenditure of Rs 350 billion and understating expenditure of Rs 250 billion. The workers welfare fund was wiped out by the previous government but the incumbent government has allocated Rs.4.5 billion for construction of 8276 houses.

Complete text of Finance Bill

Highlighting the salient features of the Finance Supplementary (Amendment) Bill 2018 introduced by him in National Assembly in the context of economic situation, Asad Umar said that the budget presented by the previous government projects fiscal deficit at 4.6 percent and if the present measures are not taken it will be 7.1 percent.

He said that the present measures will reduce the fiscal deficit to 5.1 percent of GDP.

The minister said that the fiscal deficit during year 2012 was 6.6 percent and it is same in 2017-18, while today the debt to GDP ratio is 72.5 percent and total debt is Rs. 30 trillion.

He said that budget deficit was not sustainable and real crisis was foreign exchange reserves as external debt today stood at US$ 95 billion in 2012-13.

In 2013, six billion were enough to meet six weeks of import and now it is 7.5 billion and enough to meet seven weeks of import. He said that government printed currency equal to Rs. 1200 billion and the last year budget deficit does not reflect two trillion of deficits which includes circular debt etc.

Asad Umar said that PSO was on the verge of bankruptcy which had international consequences. The government, he said, promised China for a separate fund to pay previous power projects installed by China that was never created.

He said that we have increased 10 percent gas prices for the poor and 30 percent for the rich people while there has been 30 percent cut in LPG prices which is used by the poor.

The minister said that we will protect autonomy of State Bank of Pakistan (SBP) which will be responsible for exchange rate and monetary policy. He was hopeful to curtail fiscal deficit and said that no other province except Khyber Pakhtunkhwa (KP) showed surplus which was Rs.34 billion last year.

He said that non-filers will now be allowed to purchase property and vehicles because overseas Pakistanis who were non-filers were facing severe problems. The minister said that Rs 26 billion taxes will be collected by increase of excise duty on cigarettes.

Federal excise duties on vehicles above 1800 CC have been increased from 10 to 20 percent, he said adding that the minimum taxation rate is maintained at Rs1.2 million.

The minister said that only 70,000 rich people will be affected with the reversal of taxation measures taken by the previous government and the expected earnings is Rs 26 billion.

He said that taxes slab has been reduced from 35 percent to 29 percent while prime minister, ministers and governors will no longer have tax exemption.

The Federal Government will provide health cards to FATA while the Punjab Government has been directed to provide Health Cards for coverage expenditure upto Rs 540,000 as done in Khyber Pakhtunkhwa.

The minimum pension for EOBI has been increased by 10%, he said adding that the export industry will be

encouraged by withdrawing regulatory duties on raw material. Government has also provided subsidiary of Rs 44 billion on gas for export oriented industry.

Finance Minister said that the discretionary fund of prime minister of Rs 80 billion has been withdrawn. The actual expenditure of PSDP last year was Rs. 61 billion which has been increased to 725 billion, he added.