The government has almost finalized broad contours of next fiscal year's budget with an estimated federal outlay of Rs5.6 trillion and revenue collection - tax and non-tax Rs4.5 trillion. This was stated by Advisor to Prime Minister on Finance Dr Miftah Ismail during his media talk while responding to questions on Thursday after speaking here at two budget seminars. "The federal outlay will be around Rs5.5 trillion with non-tax and tax revenue Rs4495 billion," the advisor affirmed to media questions.
Sources in Finance Ministry stated that Rs220 billion are expected to be earmarked for subsidies in the next fiscal year while defense budget would be around Rs1 trillion. They added that GDP growth target is likely to be set at 6.2 to 6.5 percent for the next fiscal year.
The advisor said almost 80 to 90 percent budget for any fiscal year remains as it is with a nominal increase on the basis of inflation and is finalized by the bureaucracy without any input. However, the government is considering various proposals to increase the pay and pension of the federal government employees and stated, "We will present the budget for the next entire fiscal year."
He said the new government will have the right to make changes in the budget after coming into power and "presentation of budget by an elected government is far better as compared to leaving it for the caretaker setup to present the budget."
The advisor stated that he himself will make the budget statement in the Parliament on April 27. Ismail said people will be given tax relief in the budget. The advisor further stated that four 'Es'- extremism, energy, education, economy - constitute the manifesto and priority areas of the of the PML-N government.
He said the government installed and made operational12,000 MW power plants during last four years, increased allocation for education by transfer more resources from divisible pool to the provinces for enabling them to discharge their responsibility in terms of education more effectively after the subject was devolved to them with the approval of 18th Constitutional Amendment from the Parliament. Provincial transfers have been increased from divisble pool to Rs2,400 from Rs1,299 billion when present government came in power.
The GDP growth has been increased from below 3 percent to 5.79 percent by the present government and Benazir Income Support Program (BISP) disbursement were increased to Rs125 billion to reduce poverty. However, he stated a growth of over 8 percent will be required for job creation and poverty alleviation.
The advisor stated that governance model in Pakistan has not done well in the country with Discos facing losses of Rs175 billion because of being enough inefficient, and privatization of Pakistan International Airlines (PIA) and Pakistan Steel Mills (PSM) needs to be top agenda whatever party comes in power after the election.
The advisor stated the government has taken positive steps for the economy by announcing tax amnesty scheme, which will encourage new taxpayers to enroll themselves in the tax net. He said the government will make difficult for non-filers to participate in the economy from July 1, 2018. The government is working with National Database and Registration Authority (NADRA) in this regard.
Miftah Ismail said those who are non-filers will be unable to purchase properties after budget. The advisor raised some concerns about increase in current account deficit to 58 percent but attributed the increase to rise in imports for the China-Pakistan Economic Corridor (CPEC) which widened trade deficit while remittances remained stagnant. However, he said that exports are increasing due to some measures taken by the government and this trend is likely to continue in the coming months as well.