NA passes ‘mini-budget’, SBP bill amid awful din

ISLAMABAD: In a bid to achieve Rs6.1 trillion tax target – as per the requirement of the International Monetary Fund (IMF) – the National Assembly, on Thursday, passed the Finance (Supplementary) Bill, 2021 and the State Bank of Pakistan (Amendment) Bill, 2021 amid strong protest by the opposition.

The Finance (Supplementary) Bill, 2021 also known as ‘mini-budget’ was passed by the house with some amendments presented by the finance minister, himself, while all the amendments put forth by the opposition were rejected.

Finance Minister Shaukat Tarin moved the bill, which was adopted by the house with majority vote after clause by clause reading was completed, incorporating some amendments moved by the finance minister, himself.

The Muttahida Qaumi Movement-Pakistan (MQM), which is a coalition partner of the PTI-led federal government, withdrew its amendments after the finance minister said their concerns were addressed.

The MQM-P amendments were moved by MNA Kishwar Zahra, to which Tarin said that most of the demands had already been incorporated. In response, the MQM MNA thanked the minister, and withdrew their amendments.

In the amended bill, the government rolled back its plan to impose additional sales taxes on children’s formula milk, bread, other bakery items and small cars up to 800cc. It also withdrew the proposal to impose taxes on solar panels, laptops and computers.

The opposition’s amendments to the bill were rejected and when the voting took place, 150 members voted in favour of the amendments, while 168 voted against them.

‘Mini-budget’, SBP bill: MNAs expected to cast their vote today

Responding to the points raised by the opposition, the finance minister said that with the current pace of economic growth, the country could expect five percent growth in the fiscal year 2022, and more than six percent in 2023.

He said that the government is trying to correct structural issues pertaining to the tax to ensure inclusive and sustainable growth in the country, which no any previous government did.

He said that no additional taxes have levied on items of common man’s usage including laptops, baby food, roti (bread), pesticides, bakery items, and digital payments.

He said that Rs70 billion taxes have been proposed on luxury items in this bill, which would have no impact on the common man, adding a refund of Rs280 billion will be given under this bill.

Tarin said that the supplementary finance bill is a step towards the process of documentation, as it is not a matter of tax collection only.

He also assured the house that prices of medicines will not increase, adding: “We had no option to avoid IMF, as we have to take our products to the value-added tax mode to achieve an inclusive and sustainable growth”.

He said that revenue is growing by 35 percent, while remittances and exports are also on the upward trajectory, adding there is unprecedented growth of 35pc in revenue collection.

He said that the remittances and the exports are also witnessing growth and there has been a bumper production of five crops due to farmer-friendly policies of the government.

To the opposition’s criticism for approaching the IMF, Tarin said that both the PPP and the PML-N went to the IMF approximately 13 times in their respective tenures, adding did they forfeit our economic sovereignty each time.

PPP chairman Bilawal Bhutto Zardari said that “if the finance minister is a man of his words, he must recall his budget speech when he claimed there will be no more taxes and mini-budget”.

“We know the address of your Karachi residence…just go and ask people why they are upset. If you will not go to people, we will bring people to you,” he warned.

Referring to the strict conditions of the IMF, Bilawal said: “If the government is serious about Pakistan, it must reject the IMF budget and we will bring the country out of the prevailing economic crisis.”

NA session adjourned after govt tables SBP amendment bill, 'mini-budget' amid ruckus

Bilawal said before becoming the finance minister, Tarin had termed the IMF deal adverse for the country and had pledged to renegotiate.

He said that no prime minister in the past had ever made tall claims like PM Khan that “he would commit suicide instead of going to the IMF”.

“Both the prime minister and his finance minister are not men of their words,” he lamented.

PML-N’s Shahid Khaqan Abbasi questioned the claims of the finance minister that the finance bill will not put the burden on the masses, saying “then why the mini-budget is being introduced”.

He also asked the minister to assure the house that the finance bill will not trigger a new wave of inflation, and the prices of medicines will not go up.

“It has been six months since you passed the finance bill. Have your revenues declined or expenses increased since then,” he asked.

He also questioned why the people were being burdened with additional taxes of Rs350 billion.

In response, Tarin said that the IMF had called for imposing a value-added tax when he had previously served as the finance minister, but he plainly said ‘no’ to them.

He said that the country cannot achieve its target of 6-8 percent growth until the tax-to-GDP ratio is around 18-20 percent.

The opposition lawmakers also called for the House to debate the recommendations put forth by the Senate.

PML-N’s Ahsan Iqbal said that the recommendations put forth by the Senate regarding the mini-budget had not been discussed. He called it an insult to the Senate.

Voting also took place on several amendments moved by the opposition to the finance bill that were subsequently rejected through a voice vote and head counting.

Shortly after the NA passed the mini-budget, the opposition benches were up in arms against the “bulldozing” of the SBP bill and called for holding a detailed discussion after the speaker suspended the rules for debate.

Addressing the speaker, PML-N’s Ahsan Iqbal called on him to not suspend the rules of the House. “If you suspend the rules and bulldoze the bill in the darkness of the night, your name will go down in history among those who conspired to sell the country’s economic sovereignty.”

He urged the speaker to let lawmakers discuss the bill for two days.

Shahid Khaqan Abbasi said that the SBP bill was not in the country’s interest. He said that the opposition was ready to debate the bill today and tomorrow.

Taking a dig at the government, PPP Chairman Bilawal Bhutto Zardari said that it was very rare to have the premier and the entire front row of the treasury benches in attendance. He reiterated calls for a detailed debate. “This bill says that Pakistan’s defence expenditure will have just one bank account and all expenditures will be made through that account,” he said, adding that this would make it easier for “international forces” to scrutinise the country’s defence and nuclear expenditure. The opposition began to chant slogans and surrounded the speaker’s dais, who then initiated voting on all the amendments by the opposition, which were subsequently rejected.

The opposition’s amendments were presented by the speaker after opposition lawmakers resorted to chanting slogans against the government. Following this, a clause by clause vote was initiated on the bill, all of which were approved by the House.

Copyright Business Recorder, 2022