Muttahida Qaumi Movement on Monday presented a federal shadow budget of Rs 3.775 trillion for the fiscal year of 2014-15, with a budget deficit of one trillion rupees that amounts to 3.5 per cent of the GDP. The budget also envisages 6 per cent growth rate for the upcoming fiscal year as compared to 4 per cent expected in the federal government's budget to be presented on Tuesday (today).
While presenting the budget here along with party members, Dr Farooq Sattar said that his party is giving last opportunity to Prime Minister Nawaz Sharif and Finance Minister Ishaq Dar to come up to the expectations of people in the budget. "People are turning up on the roads to protest against the economic policies of the government and it could be a turning point," he warned the government while questioning, "where is economic policy of the PML-N that the party has been trumpeting in the election campaign."
The MQM's shadow budget also suggests the government should decrease General Sales Tax (GST) from 17 per cent to 9 per cent. "This will help generate over Rs 1,200 billion if implemented in good faith," he said. Sattar also suggested the government to allocate 5 per cent of the GDP for education and health besides balancing the direct to indirect tax ratio. The shadow budget envisages 53:47 direct to indirect tax ratio as compared to the government's 37:63. The shadow budget also slashes the government's expected current expenditure from Rs 3,550 billion to Rs 2,775 billion but predicts increase in development expenditure from the government's expected Rs 800 billion to Rs 1,000 billion.
The shadow budget also urges the government to increase minimum wages for workers to Rs 20,000 besides increasing salaries and pensions for the government employees by 15 per cent. The MQM also presents some major proposals and reforms to revive the country's economy. The party in its shadow budget says that if the government starts collecting income tax on agriculture, it could amount to Rs 161.5 billion per annum.
The federal government budget estimated expenditure of Rs 1,876 billion in 2012-13 that was raised to Rs 2,357 billion in 2013-14 which the MQM says needs to be contained. The party also suggests that rampant corruption, especially in Federal Board of Revenue, State Trading Corporations and enterprises should be eliminated. "The government should constitute a parliamentary committee with representation from all elected political parties to eliminate corruption," Sattar said.
The government should abolish a petroleum levy forthwith to provide relief to common man. "The petroleum prices could be slashed by 20 per cent if the levy is eliminated," he said, adding that Federal Interior Minister Nisar Ali Khan had been labelling the levy as "bhatta tax" in the previous government. The shadow budget suggests the public sector enterprises - Railways, Steel Mills and Pakistan International Airline - running on huge losses need to be placed under Professional Policy Boards and Managements and Public Private Partnerships.
To put a comprehensive plan in place, stretching from one to two years, to permanently settle the circular debt issue, and till such time use energy subsidy to address the issue, suggests the shadow budget. "The MQM rejects the recent decision of Economic Co-ordination Committee to pass on the circular debt burden on consumers," he said, adding "the party may also publish a white paper to highlight discrepancies in distribution of Rs 350 billion by the government to IPPs." The government should offer incentives to businessmen and engineering students to address the energy crisis by introducing viable renewable energy solutions, he said. Sattar said the country cannot be steered out of economic crisis until people are offered economic incentives. "The ever increasing gap between the rich and the poor is a threat to the country's security and stability," he said.
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